Exam 4: Activity-Based Costing

Figure 4-18 Ubben Manufacturing uses an activity-based costing system.The company produces Model X and Model Y.Information relating to the two products is as follows: The following costs are reported: -Refer to Figure 4-18.Setups would be classified as a

Figure 4-20 Owens Corporation produces specially machined parts.The parts are produced in batches in one continuous manufacturing process.Each part is custom produced and requires special engineering design activity (based on customer specifications).Once the design is completed, the equipment can be set up for batch production.Once the batch is completed, a sample is taken and inspected to see if the parts are within the tolerances allowed.Thus, the manufacturing process has four activities: engineering, setups, machining, and inspecting.Costs have been assigned to each activity using direct tracing and resource drivers: Owens produces two models: Model X and Model Y.The following table shows how the two products consume activity. - Refer to Figure 4-20.Using the activity ratios for engineering and machining, what is the overhead rate for machining? (round to two decimal places)

Figure 4-11 Yang Manufacturing Company manufactures two products (A and B).The overhead costs ($58,000) have been divided into three cost pools that use the following activity drivers: - Refer to Figure 4-11.Using functional-based costing, what is the amount of overhead cost to be assigned to Product B using labor hours as the allocation base?

_____________ is a simple list of activities identified in an ABC system.

Figure 4-21 Jones Manufacturing uses an activity-based costing system.The company produces Model X and Model Y.Information relating to the two products is as follows: The following overhead costs are reported for the following activities of the production process: Jones manufacturing has used activity based costing to assign costs to Models X and Y as given in the table below: Jones Manufacturing wants to implement an approximately relevant ABC system by using the two most expensive activities for cost assignment. - Refer to Figure 4-21.Under this new approach using the new rates, what labor cost is assigned to Model X in this approximately relevant ABC system?

Figure 4-22 Isidora's Clinic is considering a time-driven activity based costing system.Given the following data: -Refer to Figure 4-22.What is the activity rate for responding to requests?

Batch-level costs are assigned using

All of the following are unit-based activity drivers EXCEPT

Figure 4-6 Cabrini Company produces two products: toy trucks and toy cars.They use departmental overhead rates for the two production departments: molding and finishing.Molding uses machine hours to assign overhead and Finishing uses direct labor hours.50,000 trucks and 250,000 cars are produced.Please find the following data: -Refer to Figure 4-6.What is the overhead per unit for cars? (round to 3 decimal places)

A(n) _______________ method first traces costs to a department and then to products.

A predetermine overhead rate is calculated using which of the following formulas?

Figure 4-21 Jones Manufacturing uses an activity-based costing system.The company produces Model X and Model Y.Information relating to the two products is as follows: The following overhead costs are reported for the following activities of the production process: Jones manufacturing has used activity based costing to assign costs to Models X and Y as given in the table below: Jones Manufacturing wants to implement an approximately relevant ABC system by using the two most expensive activities for cost assignment. - Refer to Figure 4-21.Under this new approach, what is the new pool rate for batch inspection costs?

Figure 4-5 The Hampshire Company produces 9 volt batteries and AAA batteries.The Hampshire Company uses a plantwide rate to apply overhead based on direct labor hours.The following data is given: - Refer to Figure 4-5.If the accounts had the following balances, how much will cost of goods sold be adjusted?

The Data Maintenance Corporation provided the following data about its resources and activities. In addition, computers are used for issuing statements (30 percent) and processing data (70 percent).Phones, supplies, and answering customer inquiries are 60 percent, with the other 40 percent divided equally among the remaining activities, including supervision.The supervisor spends 100 percent of his/her time on supervision.In addition to the 25,000 clerical hours, there are 2,000 hours of supervision used (the hours used by the supervising clerks activity which is not listed above) Required: Prepare a work distribution matrix for the primary activities.

Figure 4-10 The Emmanuele Company has collected the following data for use in calculating product costs: Activity Data: (expected and actual) Departmental Data: (expected and actual) -Refer to Figure 4-10.What are the consumption ratios for mops and brooms respectively for the inspection of products activity?

Figure 4-10 The Emmanuele Company has collected the following data for use in calculating product costs: Activity Data: (expected and actual) Departmental Data: (expected and actual) - Refer to Figure 4-10.What are the consumption ratios for mops for the departments on the basis of the departmental drivers (molding;assembly)?

Figure 4-20 Owens Corporation produces specially machined parts.The parts are produced in batches in one continuous manufacturing process.Each part is custom produced and requires special engineering design activity (based on customer specifications).Once the design is completed, the equipment can be set up for batch production.Once the batch is completed, a sample is taken and inspected to see if the parts are within the tolerances allowed.Thus, the manufacturing process has four activities: engineering, setups, machining, and inspecting.Costs have been assigned to each activity using direct tracing and resource drivers: Owens produces two models: Model X and Model Y.The following table shows how the two products consume activity. -Refer to 4-20.How much overhead is assigned to Model Y using the 4 activity drivers?

Activity-based costing assigns cost to cost objects by first tracing costs to

Figure 4-20 Owens Corporation produces specially machined parts.The parts are produced in batches in one continuous manufacturing process.Each part is custom produced and requires special engineering design activity (based on customer specifications).Once the design is completed, the equipment can be set up for batch production.Once the batch is completed, a sample is taken and inspected to see if the parts are within the tolerances allowed.Thus, the manufacturing process has four activities: engineering, setups, machining, and inspecting.Costs have been assigned to each activity using direct tracing and resource drivers: Owens produces two models: Model X and Model Y.The following table shows how the two products consume activity. -Refer to Figure 4-20.Determine the overhead costs assigned to model Y using the two most expensive activities for cost pools.The costs of the two relatively inexpensive activities are allocated to the two most expensive activities in proportion to their costs.(Round to two decimal places.)The engineering cost assigned to model Y would be

Figure 4-21 Jones Manufacturing uses an activity-based costing system.The company produces Model X and Model Y.Information relating to the two products is as follows: The following overhead costs are reported for the following activities of the production process: Jones manufacturing has used activity based costing to assign costs to Models X and Y as given in the table below: Jones Manufacturing wants to implement an approximately relevant ABC system by using the two most expensive activities for cost assignment. - Refer to Figure 4-21.Under this new approach using consumption ratios for labor related and machine hours, what allocation rate would be used to assign labor related costs? (round to 5 decimal places)