A company manufactures two product types: Product A and Product B. The company uses an activity-based costing (ABC) system that allocates all of its overhead to three cost pools. The activity rates for the three cost pools are in the table below: Activity Cost Pool Machining Factory Setups Product Design Activity Cost rate $20/MH $100/setup $6,000 per product type The following Table is information for Product A Product Type Machine Hours Number of setups Number of units Direct Labor Hours Overhead Costs: Machining Product A 3,000 MH Direct Material Cost Labor wage rate $25/DLH Calculate the total product cost assigned to Product A if Activity Based Costing is used. Use the Table below as guide: Product A Total Product Costs ($) Direct Material Costs Direct Labor Costs Factory Setups Product Design Total Product Costs 230 setups 10,000 units 7,000 DLH $8.00/unit ? ? ? ? ? ?

A company manufactures two product types: Product A and Product B. The company uses an activity-based costing (ABC) system that allocates all of its overhead to three cost pools. The activity rates for the three cost pools are in the table below: Activity Cost Pool Machining Factory Setups Product Design Activity Cost rate $20/MH $100/setup $6,000 per product type The following Table is information for Product A Product Type Machine Hours Number of setups Number of units Direct Labor Hours Overhead Costs: Machining Product A 3,000 MH Direct Material Cost Labor wage rate $25/DLH Calculate the total product cost assigned to Product A if Activity Based Costing is used. Use the Table below as guide: Product A Total Product Costs ($) Direct Material Costs Direct Labor Costs Factory Setups Product Design Total Product Costs 230 setups 10,000 units 7,000 DLH $8.00/unit ? ? ? ? ? ?

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter6: Activity-based, Variable, And Absorption Costing

Section: Chapter Questions

Problem 10MC: What is the proper order of tasks In an ABC system? identify the cost drivers, assign the costs to...

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