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(Solution Download) 1. Matt Company uses activity-based costing. The company has two products: A and B. The annual produ


 

 

 

 

 

 

 

1. Matt Company uses activity-based costing. The company has two

 

products: A and B. The annual production and sales of Product A is

 

9,000 units and of Product B is 8,000 units. There are three

 

activity cost pools, with total cost and total activity as

 

follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Activity

 

  Activity Cost

 

Pool

Total

 

Cost

Product AProduct BTotal
  Activity 1

 

$31,000  

 

100    

 

520    

 

620    

  Activity 2

 

$46,287  

 

860    

 

250    

 

1,110    

  Activity 3

 

$156,750  

 

840    

 

3,910    

 

4,750    

 

 

 

 

 

 

 

 

The activity-based costing cost per unit of Product A is closest

 

to: (Round your intermediate calculations to 2 decimal

 

places.)

 

 

 

 

 

 

 

 

 

2. Spendlove Corporation has provided the following data from

 

its activity-based costing system:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Activity Cost Pool

Total

 

Cost

 

Total Activity

  Assembly$1,398,25065,800machine-hours
  Processing

 

orders

 

$69,451.20  

2,520orders
  Inspection

 

$184,800  

2,400inspection-hours

 

 

 

 

 

 

 

 

The company makes 920 units of product S78N a year, requiring a

 

total of 1,290 machine-hours, 61 orders, and 40 inspection-hours

 

per year. The product's direct materials cost is $57.55 per unit

 

and its direct labor cost is $13.56 per unit. The product sells for

 

$123.50 per unit.

 

 

 

 

 

 

 

 

 

According to the activity-based costing system, the product

 

margin for product S78N is: (Round your intermediate

 

calculations to 2 decimal places.)

 

 

 

 

 

 

 

 

 

3. Activity rates from Quattrone Corporation's activity-based

 

costing system are listed below. The company uses the activity

 

rates to assign overhead costs to products:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Activity Cost Pools

 

Activity Rate

  Processing customer

 

orders

$89.95per customer order
  Assembling

 

products

$2.31per assembly hour
  Setting up

 

batches

$51.23per batch

 

 

 

 

 

 

 

 

Last year, Product F76D involved 2 customer orders, 436 assembly

 

hours, and 22 batches. How much overhead cost would be assigned to

 

Product F76D using the activity-based costing system?

 

 


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