Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Way Cool produces two different models of air conditioners. The company produces the mechanical systems in its components department. The mechanical systems are combined with

Way Cool produces two different models of air conditioners. The company produces the mechanical systems in its components department. The mechanical systems are combined with the housing assembly in its finishing department. The activities, costs, and drivers associated with these two manufacturing processes and the production support process follow. (Loss amounts should be indicated with a minus sign. Round your intermediate calculations and round "Cost per unit and OH rate" answers to 2 decimal places.)

Process Activity Overhead Cost Driver Quantity
Components Changeover $ 457,000 Number of batches 830
Machining 301,200 Machine hours 7,510
Setups 227,500 Number of setups 180
$ 985,700
Finishing Welding $ 180,600 Welding hours 3,200
Inspecting 227,000 Number of inspections 740
Rework 61,200 Rework orders 210
$ 468,800
Support Purchasing $ 136,000 Purchase orders 518
Providing space 32,150 Number of units 5,700
Providing utilities 60,780 Number of units 5,700
$ 228,930

Additional production information concerning its two product lines follows.

Model 145 Model 212
Units produced 1,900 3,800
Welding hours 1,000 2,200
Batches 415 415
Number of inspections 470 270
Machine hours 2,260 5,250
Setups 90 90
Rework orders 140 70
Purchase orders 345 173

image text in transcribed

1. Using a plantwide overhead rate based on machine hours, compute the overhead cost per unit for each product line. 2. Determine the total cost per unit for each product line if the direct labor and direct materials costs per unit are $230 for Model 145 and $190 for Model 212. Overhead Assigned Activity Driver Plantwide OH rate Total Overhead Cost Units Produced OH Cost per unit Model 145 Model 212 Model 145 Model 212 3. If the market price for Model 145 is $751 and the market price for Model 212 is $440, determine the profit or loss per unit for each model. Model 145 Model 212 Market price

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Quality And GMP Auditing Clear And Simple

Authors: James L. Vesper

1st Edition

0367400901, 978-0367400903

More Books

Students also viewed these Accounting questions

Question

Additional Factors Affecting Group Communication?

Answered: 1 week ago