Question

Beaver Company manufactures coffee tables and uses an activity−based costing system to allocate all manufacturing conversion...

Beaver Company manufactures coffee tables and uses an

activity−based

costing system to allocate all manufacturing conversion costs. Each coffee table consists of

20

separate parts totaling

$220

in direct​ materials, and requires

5

hours of machine time to produce. The company incurs no direct labor costs. Additional information​ follows:

Activity

Allocation Base

Cost Allocation Rate

Materials handling

Number of parts

$3.00

per part

Machining

Machine hours

$4.10

per machine hour

Assembling

Number of parts

$1.00

per part

Packaging

Number of finished units

$4.00

per finished unit

What is the total manufacturing cost per coffee​ table?

A.

$104.50

B.

$320.50

C.

$324.50

D. $82.00

Homework Answers

Answer #1

Answer: [Option - C] i.e. {$324.50}

DETERMINE THE MANUFACTURING COST PER UNIT
PARTICULARS ABC RATE Coffe Table
Direct Material Costs $220
Direct Labour Costs -
Overhead Costs:
Material Handling Costs [No. of Parts] $3.00 $60.00
[20 x $3.00]
Machining Costs [No. of Machine Hours] $4.10 $20.50
[5 x $4.10]
Assembling Costs                    [No. of Parts] $1.00 $20.00
[20 x $1.00]
Packaging Costs [No. of Finished Units] $4.00 $4.00
[1 x $4.00]
Total Manufacturing Cost per Coffee Table $324.50
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