Allure Company manufactures and distributes two products, M and XY. Overhead costs are currently allocated using the number of units produced as the allocation base. The controller has recommended changing to an activity-based costing (ABC) system. She has collected the following information: Activity Cost Driver Amount M XY Production setups Number of setups $ 73,000 12 18 Material handling Number of parts 49,000 68 23 Packaging costs Number of units 246,000 96,000 60,000 $ 368,000 What is the total overhead per unit allocated to Product XY using activity-based costing (ABC)

Answers

Answer 1

Answer:

Results are below.

Explanation:

First, we need to calculate the allocation rates:

Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Production setups= (73,000 / 30)= $2,433.33 per setup

Material handling= (49,000 / 91)= $538.46 per number of part

Packaging costs= (246,000 / 156,000)= $1.58 per unit

Now, we need to allocate costs to Product XY:

Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base

Production setups= 2,433.33*18= 43,799.94

Material handling= 538.46*23= 12,384.58

Packaging costs= 1.58*60,000= $94,800

Total allocated costs= $150,984.52

Finally, per unit basis:

Unitary cost= 150,984.52 /60,000= $0.27

Related Questions

You own a portfolio equally invested in a risk-free asset and two stocks. If one of the stocks has a beta of 1.12 and the total portfolio is equally as risky as the market, what must the beta be for the other stock in your portfolio

Answers

Answer:

Beta for the other stock = 1.88

Explanation:

A portfolio is said to be as risky as the market where its beta is exactly equal to 1. A beta of greater than 1 implies the portfolio is riskier than the average market, and less risky where the beta is less than 1.

A portfolio that has an equal proportion of three asset would mean a weight of 1/3 for each asset

So we can represent the portfolio beta as follows:

1 = 1/3×(0) + 1/3× (1.12) + 1/3×y

1= 0.37 + 0.33y

0.33y = 0.626

y= 0.626/0.33

y= 1.88

Beta for the other stock = 1.88

Bandar Industries manufactures sporting equipment. One of the company’s products is a football helmet that requires special plastic. During the quarter ending June 30, the company manufactured 35,000 helmets, using 22,500 kilograms of plastic. The plastic cost the company $171,000. According to the standard cost card, each helmet should require 0.6 kilograms of plastic, at a cost of $8 per kilogram. Required: 1. What is the standard quantity of kilograms of plastic (SQ) that is allowed to make 35,000 helmets? 2. What is the standard materials cost allowed (SQ × SP) to make 35,000 helmets? 3. What is the materials spending variance? 4. What is the materials price variance and the materials quantity variance?

Answers

Answer:

1. 21,000 kg of plastic

2. $168,000

3. $3000 Unfavorable

4. Materials Price variance $9000 Favaorable

Materials Quantity variance $12,000 Unvaforable

Explanation:

1. Calculation to determine the standard quantity of kilograms of plastic (SQ) that is allowed to make 35,000 helmets

Using this formula

Standard quantity of kilograms of plastic (SQ) = Standard quantity required per helmet x Total no. of helmets

Let plug in the formula

Standard quantity of kilograms of plastic (SQ) = 0.60 kg x 35,000

Standard quantity of kilograms of plastic (SQ) = 21,000 kg of plastic

Therefore The standard quantity of kilograms of plastic (SQ) that is allowed to make 35,000 helmets is 21,000 kg of plastic

2. Calculation to determine the standard materials cost allowed (SQ X SP) to make 35,000 helmets

Using this formula

Standard materials cost allowed (SQ X SP) = Standard quantity required per helmet x Standard cost per kg x Total no. of helmets

Let plug in the formula

Standard materials cost allowed (SQ X SP)= 0.60 x $8 x 35,000

Standard materials cost allowed (SQ X SP)= $168,000

Therefore The standard materials cost allowed (SQ X SP) to make 35,000 helmets is $168,000

3. Calculation to determine the materials spending variance

First step is to calculate the Materials Price variance

Using this formula

Materials Price variance = (AQ × AP) - (AQ × SP)

Let plug in the

Materials Price variance= $171,000 - (22,500 x $8)

Materials Price variance= $171,000 - 180,000

Materials Price variance= -$9,000

= $9000 Favaorable

Second step is to calculate the Materials Quantity variance using this formula

Materials Quantity variance = (AQ × SP) - (SQxSP)

Let plug in the formula

Materials Quantity variance=

Materials Quantity variance= 180,000 - $168,000

Materials Quantity variance=$12,000

Materials Quantity variance= $12,000 Unvaforable

Now let calculate the Materials spending variance using this formula

Materials spending variance = Price variance + Quantity variance

Let plug in the formula

Materials spending variance= -$9,000+ $12,000 Materials spending variance= $3,000

Materials spending variance= $3000 Unfavorable

Therefore Materials spending variance is $3000 Unfavorable

4. Calculation to determine the materials price variance and the materials quantity variance

Calculation for the Materials Price variance Using this formula

Materials Price variance = (AQ × AP) - (AQ × SP)

Let plug in the formula

Materials Price variance= $171,000 - (22,500 x $8)

Materials Price variance= $171,000 - 180,000

Materials Price variance= -$9,000

Materials Price variance= $9000 Favaorable

Therefore Materials Price variance is $9000 Favaorable

Calculation to determine Materials Quantity variance using this formula

Materials Quantity variance = (AQ × SP) - (SQxSP)

Let plug in the formula

Materials Quantity variance= = 180,000 - $168,000

Materials Quantity variance=$12,000

Materials Quantity variance= $12,000 Unvaforable

Therefore Materials Quantity variance is $12,000 Unvaforable

Other Questions

Pretend you are a part of the audience for the formal debate shown in the video below. Summarize the key points of both the affirmative and the opposing side. Then conduct some additional research to better inform yourself about the pros and cons of technology and smart devices, including the impact they have on the developing human brain. Finally, explain which side you agree with and why.here is the transcript"There's n othing smart about personalized intimate technology. It simply confirms our misplac ed ideal that the world revolv es around us.Smart technology has made us smart in some unexpected ways. It's made us more responsive. It's made us more engaged.What we've created, in other words, is an environment that is constantly frustrating our mind's ability to create deep knowledge into think deeply.This is the greatest time in human history to be wanting to know. There is no better time. The access to information has never been this free.We're losing that contemplative deep focused attentive state of mind that is crucial to the creation of knowledge, the creation of intelligence, and deep thinking in general.In this age of constant distraction-- we can't focus-- we're watching seven years of Game of Th rones, the most complex narrative that we've ever seen in our world. Our universities are turning out experts and scholars who are deep into their topics-- deeper than ever, because they can go that deep because of the internet. We are knowing more and better than ever.What we're losing is the sub tlety, the depth, the sophistication of thought. In an odd way, perhaps we're becoming like machi nes. But that, in an odd way, as well makes us du mber than we once were.There are lots of things that people do with technology in this current moment that may not rise to the bar of tenured faculty and book writers. That doesn't necessarily mean it's dum b. What is d umb, and what is lying underneath that judgment? Buried in that is notions about what is appropriate disco urse, what is sufficiently merit-worthy.We're not all broadcasting these deep thoughts. Were sending out links to sill y videos. We're going-- spending huge amounts of time on Fac ebook. We're spending lots of time on T witter, sending Snapc hats.We've never had an opportunity like this, the ability to participate in the creation of knowledge. This is the smartest age we've ever had." What was the purpose of the Interstate Commerce Commission, and how successful was it? About how much cardboard is needed to make the inner tube for a roll of paper if thetube has a diameter of 4.5 cm and is 24 cm long? Find the length of AC using Pythagorean Theorem. i know this is easy but can someone answer the following questionsComplete the following. Show all work for calculations. 25 points if answered correctlyList the dimensions of your box. Be sure to include the units (in, cm, ft, etc.).Describe the shape of the cross section when the box is cut parallel to the base.What is the surface area of the box?What is the surface area of the box if it is scaled up by a factor of 10?What is the volume of the box?What is the volume of the box if it is scaled down by a factor of 110? help me plz which one of the four pls help ill mark you brainliest What is the value of the expression 20 4 + (6 x 2) 2? PLEASE HELP IM DESPRATE 50 POINTS Explain a real world example of a combination where repetition is allowed. You need to EXPLAIN WHY, not just give an example. What is the mass of a box that weighs 1.4 kilograms? (1,000 grams = 1 kilogram) A. 14,000 g B. 140 g C. 1.4 g D. 1,400 g Find the general term of series 1/2-1+2-4+ please help again once again 10 POINTS AND 15! 9Find mZWVTT35x-2U93 WV7x + 5mZWVT = This is not so hard please helpp Choose the best greeting*A- Morning, Hannah speaking. How may I help you?"B- This is Hannah. What now?"C-Good morning, UUM Bursary, this is Hannah speaking. How may I assist you?"D- Good morning. How may I help you?" Janine charges $8.25 per hour to walk dogs. Shewalks dogs for 3 hours on Saturday and 4 hours onSunday. She calculates her total pay to be $57.75.Which equation could be used to check the reasonableness of her total? What's the surface area?(EXPLAIN YOUR ANSWER) ANSWER THE QUESTION FOR BRAINLIEST Please help me i have no clue what the answer is :? Evaluate without a calculator:cot -270