M
Mr. Dan
Guest
I'm having trouble figuring out this problem:
Activities include:
Material Handling: 225000 ; Cost driver = # of parts
Material Insertion: 2475000; # of parts
Automated machinery: 840000 ; Machine hrs
Finishing: 170000 ; Direct labor hrs
Packaging: 170000; Orders shipped
3 product lines:
Economy: 10,000 units produced, 1000 shipped, 10 parts per unit, 1 machine hr per unit, 2 labor hours per unit
Standard: 5,000 units produced, 500 shipped, 15 parts per unit, 3 machine hrs per unit, 2 labor hours per unit
Deluxe: 2,000 units produced, 200 shipped, 25 parts per unit, 5 machine hrs per unit, 2 labor hours per unit
Question: What is the cost application rate for material handling activity?
My answer is 13.23 per part but not sure if that's correct
Question: Under activity based costing, what is the per unit cost of Economy?
Activities include:
Material Handling: 225000 ; Cost driver = # of parts
Material Insertion: 2475000; # of parts
Automated machinery: 840000 ; Machine hrs
Finishing: 170000 ; Direct labor hrs
Packaging: 170000; Orders shipped
3 product lines:
Economy: 10,000 units produced, 1000 shipped, 10 parts per unit, 1 machine hr per unit, 2 labor hours per unit
Standard: 5,000 units produced, 500 shipped, 15 parts per unit, 3 machine hrs per unit, 2 labor hours per unit
Deluxe: 2,000 units produced, 200 shipped, 25 parts per unit, 5 machine hrs per unit, 2 labor hours per unit
Question: What is the cost application rate for material handling activity?
My answer is 13.23 per part but not sure if that's correct
Question: Under activity based costing, what is the per unit cost of Economy?