Question

Required information [The following information applies to the questions displayed below.] Performance Products Corporation makes two...

Required information [The following information applies to the questions displayed below.] Performance Products Corporation makes two products, titanium Rims and Posts. Data regarding the two products follow:

Direct Labor-Hours per Unit Annual Production
Rims 0.30 21,000 Units
Post 0.50 74,000 Units

Additional information about the company follows: Rims require $15 in direct materials per unit, and Posts require $12. The direct labor wage rate is $16 per hour. Rims are more complex to manufacture than Posts and they require special equipment.

The ABC system has the following activity cost pools:

Activity Cost Pool Activity Measure Estimated overhead cost Rims Posts Totals
Machine Setups Number of Setups $ 37,000 120 280 400
Special Processing Machine-hours $ 146,520 4,000 0 4,000
General Factory Direct-Labor-Hours $ 672,000 10,000 32,000 42,000

Required: 1. Compute the activity rate for each activity cost pool. (Round your answers to 2 decimal places.)

Activity Cost Pool Activity Rate
Machine Setups ? Per Setup
Special Processing ? Per MH
General Factory ? Per DHL

2. Determine the unit product cost of each product according to the ABC system. (Do not round intermediate calculations. Round your final answers to 2 decimal places.)

Unit Product Cost of Rims ?????
Unit Cost of Post ?????

Homework Answers

Answer #1

Required: 1. Compute the activity rate for each activity cost pool. (Round your answers to 2 decimal places.)

Activity Cost Pool Activity Rate
Machine Setups 37000/400 = 92.50 Per Setup
Special Processing 146520/4000 = 36.63 Per MH
General Factory 672000/42000 = 16 Per DHL

2) Calculate unit product cost

Rims Post
Machine setup 120*92.50 = 11100 25900
Special processing 146520 0
General factory 10000*16 = 160000 512000
Total 317620 537900
Unit 21000 74000
Overhead cost per unit 15.12 7.27
Direct material 15 12
Direct labor 16*.30 = 4.8 8
Unit product cost 34.92 27.27
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Exercise 4-8 Computing ABC Product Costs [LO4-2, LO4-3] [The following information applies to the questions displayed...
Exercise 4-8 Computing ABC Product Costs [LO4-2, LO4-3] [The following information applies to the questions displayed below.] Performance Products Corporation makes two products, titanium Rims and Posts. Data regarding the two products follow:     Direct Labor-Hours per unit Annual Production Rims 0.70 26,000 units Posts 0.70 90,000 units Additional information about the company follows: Rims require $14 in direct materials per unit, and Posts require $10. The direct labor wage rate is $18 per hour. Rims are more complex to...
Exercise 3-8 Computing ABC Product Costs [LO3-2, LO3-3] [The following information applies to the questions displayed...
Exercise 3-8 Computing ABC Product Costs [LO3-2, LO3-3] [The following information applies to the questions displayed below.] Performance Products Corporation makes two products, titanium Rims and Posts. Data regarding the two products follow:     Direct Labor-Hours per unit Annual Production   Rims 0.60         22,000 units      Posts 0.20         80,000 units        Additional information about the company follows: a. Rims require $14 in direct materials per unit, and Posts require $10. b. The direct labor wage rate is $15...
High-Calibre Products Corporation makes two products: titanium rims and posts. Data regarding the two products follow:...
High-Calibre Products Corporation makes two products: titanium rims and posts. Data regarding the two products follow: Direct Labour- Hours per Unit Annual Production Rims 0.20 27,000 units Posts 0.10 115,000 units Additional information about the company follows: Rims require $15 in direct materials per unit, and posts require $8. The direct labour wage rate is $13 per hour. Rims are more complex to manufacture than posts, and they require special equipment. The ABC system has the following activity cost pools:...
Fogerty Company makes two products—titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours...
Fogerty Company makes two products—titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours per Unit Annual Production Hubs 0.50 28,000 units Sprockets 0.10 46,000 units Additional information about the company follows: Hubs require $24 in direct materials per unit, and Sprockets require $10. The direct labor wage rate is $12 per hour. Hubs require special equipment and are more complex to manufacture than Sprockets. The ABC system has the following activity cost pools: Estimated Activity Activity Cost...
Fogerty Company makes two products—titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours...
Fogerty Company makes two products—titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours per Unit Annual Production Hubs 0.80 22,000 units Sprockets 0.40 52,000 units Additional information about the company follows: Hubs require $33 in direct materials per unit, and Sprockets require $12. The direct labor wage rate is $17 per hour. Hubs require special equipment and are more complex to manufacture than Sprockets. The ABC system has the following activity cost pools: Estimated Activity Activity Cost...
Required information [The following information applies to the questions displayed below.] Hickory Company manufactures two products—15,000...
Required information [The following information applies to the questions displayed below.] Hickory Company manufactures two products—15,000 units of Product Y and 7,000 units of Product Z. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates all $571,200 of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products Y and Z: Activity Cost Pool Activity...
Required information [The following information applies to the questions displayed below.] Hickory Company manufactures two products—15,000...
Required information [The following information applies to the questions displayed below.] Hickory Company manufactures two products—15,000 units of Product Y and 7,000 units of Product Z. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates all $571,200 of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products Y and Z: Activity Cost Pool Activity...
Fogerty Company makes two products—titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours...
Fogerty Company makes two products—titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours per Unit Annual Production Hubs 0.80 13,000 units Sprockets 0.40 59,000 units Additional information about the company follows: Hubs require $38 in direct materials per unit, and Sprockets require $15. The direct labor wage rate is $13 per hour. Hubs require special equipment and are more complex to manufacture than Sprockets. The ABC system has the following activity cost pools: Estimated Activity Activity Cost...
Fogerty Company makes two products—titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours...
Fogerty Company makes two products—titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours per Unit Annual Production Hubs 0.50 11,000 units Sprockets 0.10 56,000 units Additional information about the company follows: Hubs require $36 in direct materials per unit, and Sprockets require $13. The direct labor wage rate is $18 per hour. Hubs require special equipment and are more complex to manufacture than Sprockets. The ABC system has the following activity cost pools: Estimated Activity Activity Cost...
Fogerty Company makes two products—titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours...
Fogerty Company makes two products—titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours per Unit Annual Production Hubs 0.90 15,000 units Sprockets 0.50 49,000 units Additional information about the company follows: Hubs require $35 in direct materials per unit, and Sprockets require $10. The direct labor wage rate is $18 per hour. Hubs require special equipment and are more complex to manufacture than Sprockets. The ABC system has the following activity cost pools: Estimated Activity Activity Cost...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT