Joshua, Inc. uses activity-based costing. The company produces two products, 001 and 002. Information relating to...
Joshua, Inc. uses activity-based costing. The company produces two products, 001 and 002. Information relating to the two products is as follows:
|
001 |
002 |
|
|
Units produced |
19,000 |
25,000 |
|
Machine-hours |
7,500 |
8,500 |
|
Direct labor-hours |
8,000 |
12,000 |
|
Materials handling (number of moves) |
4,000 |
6,000 |
|
Setups |
5,000 |
7,000 |
The following costs are reported:
|
Materials handling |
$160,000 |
|
Labor-related overhead |
480,000 |
|
Setups |
300,000 |
Setup costs assigned to 002 are:
Homework Answers
Answer
- Total Setups are 5000 + 7000 = 12,000
- Setup cost activity rate = $ 300,000 / 12000 setups = $ 25 per setup
- No. of setups for ‘’002’’ = 7000
- Setup Cost assigned to 002 are
= 7000 setups x $ 25
= $ 175,000 Answer
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Joshua, Inc. uses activity-based costing. The company produces two products, 001 and 002. Information relating to...
Joshua, Inc. uses activity-based costing. The company produces two products, 001 and 002. Information relating to...
Joshua, Inc. uses activity-based costing. The company produces two products, 001 and 002. Information relating to the two products is as follows: 001 002 Units produced 19,000 25,000 Machine-hours 7,500 8,500 Direct labor-hours 8,000 12,000 Materials handling (number of moves) 4,000 6,000 Setups 5,000 7,000 The following costs for the year are reported: Materials handling $160,000 Labor-related overhead 480,000 Setups 300,000 Based on the above information, Material Handling costs assigned to Product 001 for the year are: Group of answer...
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