Exam 13: Activity-Based Costing: a Tool to Aid Decision Making

Brannum Corporation has provided the following data from its activity-based costing accounting system: Distribution of Resource Consumption across Activity Cost Pools: The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs that are not assigned to products. Required: a. Determine the total amount of supervisory wages and factory utilities costs that would be allocated to the Unit Processing activity cost pool. Show your work! b. Determine the total amount of supervisory wages and factory utilities costs that would NOT be assigned to products. Show your work!

What is the overhead cost assigned to Product T3 under activity-based costing?

In activity-based costing, organization-sustaining costs should be included in product costs for internal management reports that are used for decision-making.

In general, duration drivers are more accurate measures of the consumption of resources than transaction drivers.

How much indirect factory wages and factory equipment depreciation cost would be assigned to the Customer Orders activity cost pool?

What is the overhead cost assigned to Product G0 under activity-based costing?

Barnette Corporation has an activity-based costing system with three activity cost pools-Processing, Setting Up, and Other. The company's overhead costs, which consist of factory utilities and indirect labor, are allocated to the cost pools in proportion to the activity cost pools' consumption of resources. Costs in the Processing 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 and activity-based costing system appear below: Distribution of Resource Consumption Across Activity Cost Pools Required: a. Assign overhead costs to activity cost pools using activity-based costing. b. Calculate activity rates for each activity cost pool using activity-based costing. c. Determine the amount of overhead cost that would be assigned to each product using activity-based costing. d. Determine the product margins for each product using activity-based costing.

Dace Company manufactures two products, Product F and Product G. The company expects to produce and sell 3,200 units of Product F and 2,100 units of Product G during the current year. Data relating to the company's three activity cost pools are given below for the current year: Required: Using the activity-based costing approach, determine the overhead cost per unit for each product.

What is the overhead cost assigned to Product U1 under activity-based costing?

The labor time required to assemble a product is an example of a: