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View Policies Show Attempt History Current Attempt in Progress Sheridan Corporation produces two grades of non alcoholic wine from grapes that it buys from California rowers it produces and sells roughly 3.000.000 liters per year of a low cost, high volume product called CoolDay. It sells this in 600.000 literes Sheridan also produces and sells roughly 300.000 liters per year of a low volume, high cost product called Lite Mist LiteMistis sold in 1 liter bottles. Based on recent data, the CoolDay product has not been as profitable as LiteMist Management is considering dropping the inexpensive Coolway line so it can focus more attention on the itemist product. The Liteit product already demands considerably more attention than the CoolDayline Jack Eller, president and founder of Sheridan, is skeptical about this idea. He points out that for many decades the company produced only the CoolDay line and that it was always quite profitable. It wasn't until the company started producing the more complicated LiteMist wine that the profitability of CoolDay declined. Prior to the introduction of Lite Mist, the company had tosic equipment Simple growing and production procedures, and virtually no need for quality control. Because Lite Mist is bottled in 1 liter bottles it requires considerably more time and effort both to bottle and to label and box than does CoolDay. The company must bottle and handle 5 times as many bottles of Lite Mist to sell the same quantity as CoolDay, CoolDay requires 1 month of aging LiteMat requires 1 year. CoolDay requires deaning and inspection of equipment every 10.000 liters Lite Mist requires such maintenance every 600 liters. Jack has asked the accounting department to prepare an analysis of the cost per liter using the traditional costing approach and using activity-based costing. The following information was collected. CoolDay Lite Mist Direct materials per liter $0.40 $1.20 Direct labor cost per liter $0.50 $0.90 Direct labor hours per liter 0.05 0.07 Total direct labor hours 150.000 21.000 Estimated Use of Cost Drivers per Product Estimated Overhead Estimated Use of Cost Drivers Cost Drivers CoolDay Lite Mist Activity Cost Pools Grape processing $146804 6,600 6,000 600 673,200 6,600.000 3,000,000 3.600,000 287.100 900,000 600.000 300.000 Cart of grapes Total months Number of bottles Number of bottles Number of inspections Aging Bottling and corking Labeling and boxing Maintain and inspect equipment 198.900 900,000 600.000 300,000 242,400 800 350 450 $1.548,404 Question 5 of 5 0/4 Your answer is incorrect Under traditional product costing using direct labor hours, compute the total manufacturing cost per liter of both products, (Round answers to 3 decimal places, es, 12.250) CoolDay Lite Mist Manufacturing cost per liter 014 Under ABC.prepare a schedule showing the computation of the activity based overhead rates per cost driver). Round overhead rates to 3 decimal places, s 12250) Activity Cost Pools Estimated Overhead Estimated Use of Cost Drivers Activity-Based Overhead Rates Grape processing percant Aging per month Battling and corking per bottle Labeling and boxing IND Der bottle Maintain and inspect equipment per Inspection 211FM Question 5 of 5 014 CoolDay Activity Cost Pool Estimated Use of Cost Drivers Activity-Based Overhead Rates Cost Ansigned Grape processing $ Aging 5 Bottling and corking Labeling and boxing Maintain and inspect equipment Overhead costs assigned Liters produced Chhadracter 0/4 = Estimated Use of Cost Drivers Activity-Based Overhead Rates Cost Assigned $ $ $ * Your answer is incorrect Compute the total manufacturing cont per liter for both products under ABC. Round owerhead cost per liber to 3 decimol soceses 1225) CoolDay Lite Mist $ Manufacturing cost per liter Attempts: 2 of 15 used SA View Policies Show Attempt History Current Attempt in Progress Sheridan Corporation produces two grades of non alcoholic wine from grapes that it buys from California rowers it produces and sells roughly 3.000.000 liters per year of a low cost, high volume product called CoolDay. It sells this in 600.000 literes Sheridan also produces and sells roughly 300.000 liters per year of a low volume, high cost product called Lite Mist LiteMistis sold in 1 liter bottles. Based on recent data, the CoolDay product has not been as profitable as LiteMist Management is considering dropping the inexpensive Coolway line so it can focus more attention on the itemist product. The Liteit product already demands considerably more attention than the CoolDayline Jack Eller, president and founder of Sheridan, is skeptical about this idea. He points out that for many decades the company produced only the CoolDay line and that it was always quite profitable. It wasn't until the company started producing the more complicated LiteMist wine that the profitability of CoolDay declined. Prior to the introduction of Lite Mist, the company had tosic equipment Simple growing and production procedures, and virtually no need for quality control. Because Lite Mist is bottled in 1 liter bottles it requires considerably more time and effort both to bottle and to label and box than does CoolDay. The company must bottle and handle 5 times as many bottles of Lite Mist to sell the same quantity as CoolDay, CoolDay requires 1 month of aging LiteMat requires 1 year. CoolDay requires deaning and inspection of equipment every 10.000 liters Lite Mist requires such maintenance every 600 liters. Jack has asked the accounting department to prepare an analysis of the cost per liter using the traditional costing approach and using activity-based costing. The following information was collected. CoolDay Lite Mist Direct materials per liter $0.40 $1.20 Direct labor cost per liter $0.50 $0.90 Direct labor hours per liter 0.05 0.07 Total direct labor hours 150.000 21.000 Estimated Use of Cost Drivers per Product Estimated Overhead Estimated Use of Cost Drivers Cost Drivers CoolDay Lite Mist Activity Cost Pools Grape processing $146804 6,600 6,000 600 673,200 6,600.000 3,000,000 3.600,000 287.100 900,000 600.000 300.000 Cart of grapes Total months Number of bottles Number of bottles Number of inspections Aging Bottling and corking Labeling and boxing Maintain and inspect equipment 198.900 900,000 600.000 300,000 242,400 800 350 450 $1.548,404 Question 5 of 5 0/4 Your answer is incorrect Under traditional product costing using direct labor hours, compute the total manufacturing cost per liter of both products, (Round answers to 3 decimal places, es, 12.250) CoolDay Lite Mist Manufacturing cost per liter 014 Under ABC.prepare a schedule showing the computation of the activity based overhead rates per cost driver). Round overhead rates to 3 decimal places, s 12250) Activity Cost Pools Estimated Overhead Estimated Use of Cost Drivers Activity-Based Overhead Rates Grape processing percant Aging per month Battling and corking per bottle Labeling and boxing IND Der bottle Maintain and inspect equipment per Inspection 211FM Question 5 of 5 014 CoolDay Activity Cost Pool Estimated Use of Cost Drivers Activity-Based Overhead Rates Cost Ansigned Grape processing $ Aging 5 Bottling and corking Labeling and boxing Maintain and inspect equipment Overhead costs assigned Liters produced Chhadracter 0/4 = Estimated Use of Cost Drivers Activity-Based Overhead Rates Cost Assigned $ $ $ * Your answer is incorrect Compute the total manufacturing cont per liter for both products under ABC. Round owerhead cost per liber to 3 decimol soceses 1225) CoolDay Lite Mist $ Manufacturing cost per liter Attempts: 2 of 15 used SA