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Glassworks Inc. produces two types of glass shelving, rounded edge and squared edge, on the same...

Glassworks Inc. produces two types of glass shelving, rounded edge and squared edge, on the same production line. For the curRounded Edge Squared Edge Total Direct materials ...... Direct labor ....... Overhead (300% of direct labor cost) .... Total

Glassworkss controller wishes to apply activity-based costing (ABC) to allocate the $108,000 of overhead costs incurred by tOverhead Cost Category (Activity Cost Pool) Cost Supervision .. Depreciation of machinery. Assembly line preparation ..... To

She has also collected the following information about the cost drivers for each category (cost pool) and the amount of eachOverhead Cost Category (Activity Cost Pool) Usage Squared Edge Driver Rounded Edge Total Supervision ..................... De

Required 1. Assign these three overhead cost pools to each of the two products using ABC. 2. Determine average cost per footRequired: 1. Assign these three overhead cost pools to each of the two products using ABC. Overhead Cost Activity Drivers Act

Glassworks Inc. produces two types of glass shelving, rounded edge and squared edge, on the same production line. For the current period, the company reports the following data.
Rounded Edge Squared Edge Total Direct materials ...... Direct labor ....... Overhead (300% of direct labor cost) .... Total cost. Quantity produced ...... Average cost per ft. (rounded) ......... $19,000 12,200 36,600 $67,800 10,500 ft. $ 6.46 $ 43,200 23,800 71,400 $138,400 14,100 ft. $ 9.82 $ 62,200 36,000 108,000 $206,200
Glassworks's controller wishes to apply activity-based costing (ABC) to allocate the $108,000 of overhead costs incurred by the two product lines to see whether cost per foot would change markedly from that reported above. She has collected the following information.
Overhead Cost Category (Activity Cost Pool) Cost Supervision .. Depreciation of machinery. Assembly line preparation ..... Total overhead.... $ 5,400 56,600 46,000 $108,000
She has also collected the following information about the cost drivers for each category (cost pool) and the amount of each driver used by the two product lines.
Overhead Cost Category (Activity Cost Pool) Usage Squared Edge Driver Rounded Edge Total Supervision ..................... Depreciation of machinery ........ Assembly line preparation ......... Direct labor cost($) Machine hours Setups (number) $12,200 500 hours 40 times $23,800 1,500 hours 210 times $36,000 2,000 hours 250 times
Required 1. Assign these three overhead cost pools to each of the two products using ABC. 2. Determine average cost per foot for each of the two products using ABC.
Required: 1. Assign these three overhead cost pools to each of the two products using ABC. Overhead Cost Activity Drivers Activity Rate Activity Supervision Depreciation of machinery Assembly line preparation Direct labor cost Machine hours Setups Rounded edge ----------Activity rate---------- Activity driver incurred Overhead assigned Supervision Depreciation of machinery Assembly line preparation Squared edge ---------Activity rate------- Activity driver incurred Overhead assigned Components Supervision Depreciation of machinery Assembly line preparation 2. Determine average cost per foot for each of the two products using ABC. Rounded edge Squared edge
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Answer #1

From the information given in the problem, I have solved Allocation of overhead cost and calculation of average cost per foot using ABC.

A E H K Activity Rate 15% 28.30 Activity driver incurred Overhead assigned 12200 Direct labor cost 1830 500 Machine hours 141

2.Determination of the average cost per foot for each of the product using ABC. Total 62200 36000 108000 Rounded edge Squared

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