Question

Adity a nd Activity and Product Casting Hammer Company produces a variety of ectronicament. One of its parts product the end there the beginning the year, the wing data were prepared for this Deluxe Regular Quantity 100.000 500.000 Selling price Unit grime cost 1900 $750 $529 r mation was provided In addition, the fo that had to b e d tech product: Activity Name Activity the De Regular Activity Cost Setups Number of setups $1,350,000 Machine Hours Machining 500.000 100,000 100,000 Engineering 50,000 9,000,000 Engineering hours 100 400,000 Padang Required 1. Calculate the overadres for each activity. If required, carry your answers out to the Machining 100,000 X machine hour Engineering 100,000 X per engineering hour Padang 2. Calculate the per un products for each product. Round your answers to the nearest wholedo Delux e

Answer 1

Requirement 1

	Activity rate
Setups	$       3,700.00	Per setup
Machining	$          100.00	Per machine hour
Engineering	$             60.00	Per engineering hour
Packing	$               0.40	Per packing order

Requirement 2

Deluxe	$                  670.50 per unit
Regular	$                  529.13 per unit

Working

Calculation of Activity rates
Activity Cost Pool	Activity driver	Overhead Cost (A)	Expected Activity (B)	Activity rate (A/B)
Setups	Number of setup	$ 1,850,000	500	$       3,700.00	Per setup
Machining	Number of machine hour	$ 40,000,000	400000	$          100.00	Per machine hour
Engineering	Number of engineering hour	$ 9,000,000	150000	$             60.00	Per engineering hour
Packing	Number of packing order	$ 200,000	500000	$               0.40	Per packing order

.

Cost assigned to Deluxe
Activity name	Activity Rates	Activity	ABC Cost
	(A)	(B)	(A x B)
Setups	$     3,700.00	300.00	$ 1,110,000
Machining	$        100.00	100,000.00	$ 10,000,000
Engineering	$           60.00	50,000.00	$ 3,000,000
Packing	$             0.40	100,000.00	$ 40,000
Total Overheads assigned			$ 14150000.,0
Production			100,000.00
Overhead cost per unit			$ 141.50

.

Cost assigned to Regular
Activity name	Activity Rates	Activity	ABC Cost
	(A)	(B)	(A x B)
Setups	$     3,700.00	200	$ 740,000
Machining	$        100.00	300000	$ 30,000,000
Engineering	$           60.00	100000	$ 6,000,000
Packing	$             0.40	400000	$ 160,000
Total Overheads assigned			$ 36,900,000
Production			800,000.00
Overhead cost per unit			$               46.13

.

ABC Costing
	Deluxe	Regular
Prime cost	$                  529.00	$                   483.00
Overheads	$                  141.50	$                     46.13
Total Cost per unit	$                  670.50	$                   529.13