Exam 6: Activity-Based Costing: a Tool to Aid Decision Making

Laningham Corporation uses an activity based costing system to assign overhead costs to products. In the first stage, two overhead costs-equipment depreciation and supervisory expense-are allocated to three activity cost pools-Machining, Order Filling, and Other-based on resource consumption. Data to perform these allocations appear below: In the second stage, Machining costs are assigned to products using machine-hours (MHs) and Order Filling costs are assigned to products using the number of orders. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow: -The activity rate for the Machining activity cost pool under activity-based costing is closest to:

Bubb Corporation has provided the following data from its activity-based costing accounting system: Required: Compute the activity rates for each of the three cost pools.Show your work!

Data concerning three of Pressnell Corporation's activity cost pools appear below: Required: Compute the activity rates for each of the three cost pools.Show your work!

Transaction drivers usually take more effort to record than duration drivers.

Christiansen Corporation uses an activity-based costing system with the following three activity cost pools: The Other activity cost pool is used to accumulate costs of idle capacity and organization-sustaining costs. The company has provided the following data concerning its costs: The distribution of resource consumption across activity cost pools is given below: The activity rate for the Order Processing activity cost pool is closest to:

Drewniak Corporation has provided the following data from its activity-based costing system: The company makes 430 units of product O37W a year,requiring a total of 690 machine-hours,40 orders,and 10 inspection-hours per year.The product's direct materials cost is $35.72 per unit and its direct labor cost is $29.46 per unit. According to the activity-based costing system,the average cost of product O37W is closest to:

Ollivier Corporation has an activity-based costing system with three activity cost pools-Processing, Supervising, and Other. In the first stage allocations, costs in the two overhead accounts, equipment expense and indirect labor, are allocated to the three activity cost pools based on resource consumption. Data used in the first stage allocations follow: Processing costs are assigned to products using machine-hours (MHs) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow: -How much overhead cost is allocated to the Supervising activity cost pool under activity-based costing?

Kapoor Corporation uses the following activity rates from its activity-based costing to assign overhead costs to products. Data concerning two products appear below: Required: a.How much overhead cost would be assigned to Product J00A using the company's activity-based costing system? Show your work! b.How much overhead cost would be assigned to Product S06U using the company's activity-based costing system? Show your work!

Ormond Corporation uses activity-based costing to assign overhead costs to products. Overhead costs have already been allocated to the company's three activity cost pools as follows: Machining, $6,800; Order Filling, $10,700; and Other, $4,500. Machining costs are assigned to products using machine-hours (MHs) and Order Filling costs are assigned to products using the number of orders. The costs in the Other activity cost pool are not assigned to products. Activity data appear below: -What is the overhead cost assigned to Product B6 under activity-based costing?

Activity-based costing is a costing method that is designed to provide managers with product cost information for external financial reports.

Designing a new product is an example of (an):

Austad Corporation uses activity-based costing to determine product costs for external financial reports. The company has provided the following data concerning its activity-based costing system: -The activity rate for the batch setup activity cost pool is closest to:

Ekmark Corporation uses the following activity rates from its activity-based costing to assign overhead costs to products: Data for one of the company's products follow: How much overhead cost would be assigned to Product P59G using the activity-based costing system?

Narayan Corporation has an activity-based costing system with three activity cost pools-Machining,Setting Up,and Other.The company's overhead costs,which consist of equipment depreciation and indirect labor,have been allocated to the cost pools already and are provided in the table below. Costs in the Machining cost pool are assigned to products based on machine-hours (MHs)and costs in the Setting Up cost pool are assigned to products based on the number of batches.Costs in the Other cost pool are not assigned to products.Data concerning the two products and the company's costs appear below: Required: a.Calculate activity rates for each activity cost pool using activity-based costing. b.Determine the amount of overhead cost that would be assigned to each product using activity-based costing. c.Determine the product margins for each product using activity-based costing.

Andujo Company allocates materials handling cost to the company's two products using the below data: The total materials handling cost for the year is expected to be $115,776. -If the materials handling cost is allocated on the basis of direct labor-hours,how much of the total materials handling cost would be allocated to the prefab barns? (Round off your answer to the nearest whole dollar. )

Roshannon Corporation uses activity-based costing to compute product margins. In the first stage, the activity-based costing system allocates two overhead accounts-equipment expense and indirect labor-to three activity cost pools-Processing, Supervising, and Other-based on resource consumption. Data to perform these allocations appear below: In the second stage, Processing costs are assigned to products using machine-hours (MHs) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow: Finally, sales and direct cost data are combined with Processing and Supervising costs to determine product margins. -The activity rate for the Processing activity cost pool under activity-based costing is closest to:

Bossie Corporation uses an activity-based costing system with three activity cost pools.The company has provided the following data concerning its costs and its activity based costing system: How much cost,in total,would be allocated in the first-stage allocation to the Assembly activity cost pool?

Traughber Corporation uses an activity based costing system to assign overhead costs to products. In the first stage, two overhead costs-equipment expense and indirect labor-are allocated to the three activity cost pools-Processing, Supervising, and Other-based on resource consumption. Data to perform these allocations appear below: In the second stage, Processing costs are assigned to products using machine-hours (MHs) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow: -The activity rate for the Processing activity cost pool under activity-based costing is closest to:

Sibble Corporation uses activity-based costing to assign overhead costs to products. Overhead costs have already been allocated to the company's three activity cost pools as follows: Processing, $12,400; Supervising, $4,400; and Other, $5,200. Processing costs are assigned to products using machine-hours (MHs) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data appear below: -The activity rate for the Supervising activity cost pool under activity-based costing is closest to:

Maccarone Corporation has provided the following data from its activity-based costing system: Data concerning one of the company's products,Product A43V,appear below: According to the activity-based costing system,the product margin for product A43V is: