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Zindekal Company produces two types of vitamin pills, alpha and beta. The business produced 3,000 boxes of alpha and 2,000 boxes of beta pills in
Zindekal Company produces two types of vitamin pills, alpha and beta. The business produced 3,000 boxes of alpha and 2,000 boxes of beta pills in February 2019. The direct raw material and direct labor costs per box to produce these vitamin pills are as follows. In addition, a total of 240,000TL of general production cost (GM) was incurred in February. The enterprise loads the GUMs to the products according to the machine hours worked (ms). In February, a total of 3,000ms was studied for the alpha product and a total of 1,000ms for the beta product. Business management is of the opinion that the traditional costing approach does not suit their companies well and therefore there may be errors in product costing. As a result of the consultancy they received, they decided that the activity-based costing system would be more suitable for the company. The cost pools created as a result of the studies carried out in this direction by the business management considering the activity-based costing system, the general production costs collected in these pools and the cost factors are presented in the table below. The distribution of cost factors by products is as follows. REQUIRED: a) Calculate the unit costs of alpha and beta products according to the traditional method. b) Calculate the unit costs of alpha and beta products according to the activity-based costing method. c) Interpret the different results according to the two methods. Zindekal Company produces two types of vitamin pills, alpha and beta. The business produced 3,000 boxes of alpha and 2,000 boxes of beta pills in February 2019. The direct raw material and direct labor costs per box to produce these vitamin pills are as follows. In addition, a total of 240,000TL of general production cost (GM) was incurred in February. The enterprise loads the GUMs to the products according to the machine hours worked (ms). In February, a total of 3,000ms was studied for the alpha product and a total of 1,000ms for the beta product. Business management is of the opinion that the traditional costing approach does not suit their companies well and therefore there may be errors in product costing. As a result of the consultancy they received, they decided that the activity-based costing system would be more suitable for the company. The cost pools created as a result of the studies carried out in this direction by the business management considering the activity-based costing system, the general production costs collected in these pools and the cost factors are presented in the table below. The distribution of cost factors by products is as follows. REQUIRED: a) Calculate the unit costs of alpha and beta products according to the traditional method. b) Calculate the unit costs of alpha and beta products according to the activity-based costing method. c) Interpret the different results according to the two methods
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