Following are costs for eight different items. Costs are shown for three different levels of units produced and sold. Classify each of the eight cost items as either variable, fixed, or mixed. Costs for Different Levels of Units Produced and Sold Direct labor At 0 units $ 0 At 2,000 units $ 10,000 At 4,000 units $ 20,000 Depreciation on factory equipment Direct materials 3,000 3,000 3,000 0 6,000 12,000 Rent on factory building Salesperson compensation Factory supervisor salary Factory utilities Insurance on factory building 1,000 1,000 1,000 3,000 3,000 4,000 4,000 4,000 4,000 100 500 700 800 800 800

Following are costs for eight different items. Costs are shown for three different levels of units produced and sold. Classify each of the eight cost items as either variable, fixed, or mixed. Costs for Different Levels of Units Produced and Sold Direct labor At 0 units $ 0 At 2,000 units $ 10,000 At 4,000 units $ 20,000 Depreciation on factory equipment Direct materials 3,000 3,000 3,000 0 6,000 12,000 Rent on factory building Salesperson compensation Factory supervisor salary Factory utilities Insurance on factory building 1,000 1,000 1,000 3,000 3,000 4,000 4,000 4,000 4,000 100 500 700 800 800 800

Name: 1 Following are costs for eight different items. Costs are shown for t
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Description: 1 Following are costs for eight different items. Costs are shown for three different levels of units produced and sold. Classify each of theeight cost items as either variable, fixed, or mixed.Costs for Different Levels of Units Produced and SoldDire

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter4: Accounting For Factory Overhead

Section: Chapter Questions

Problem 1P: The cost behavior patterns below are lettered A through H. The vertical axes of the graphs represent...

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The cost behavior patterns below are lettered A through H. The vertical axes of the graphs represent total dollars of expense, and the horizontal axes represent production in units, machine hours, or direct labor hours. In each case, the zero point is at the intersection of the two axes. Each graph may be used no more than once. Required: Select the graph that matches the lettered cost described here. a. Depreciation of equipmentthe amount of depreciation charged is computed based on the number of machine hours that the equipment was operated. b. Electricity billflat fixed charge, plus a variable cost after a certain number of kilowatt hours are used. c. City water billcomputed as follows: d. Depreciation of equipmentthe amount is computed by the straight-line method. e. Rent on a factory building donated by the citythe agreement calls for a fixed fee payment, unless 200,000 labor hours are worked, in which case no rent need be paid. f. Salaries of repair workersone repair worker is needed for every 1,000 machine hours or less (i.e., 0 to 1,000 hours requires one repair worker, 1,001 to 2,000 hours requires two repair workers, etc.).
Using the data in P4-2 and Microsoft Excel: 1. Separate the variable and fixed elements. 2. Determine the cost to be charged to the product for the year. 3. Determine the cost to be charged to factory overhead for the year. 4. Determine the plotted data points using Chart Wizard. 5. Determine R2. 6. How do these solutions compare to the solutions in P4-2 and P4-3? 7. What does R2 tell you about this cost model?
S Following are costs for eight different items. Costs are shown for three different levels of units produced and sold. Classify each of the eight cost items as either variable, fixed, or mixed. Costs for Different Levels of Units Produced and Sold Direct labor Depreciation on factory equipment Direct materials Rent on factory building Salesperson compensation. Factory supervisor salary Factory utilities Insurance on factory building Direct labor Depreciation on factory equipment Direct materials Rent on factory building Salesperson compensation Factory supervisor salary Factory utilities Insurance on factory building At e units $ 0 At 2,000 units $ 10,000 At 4,000 units $ 20,000 3,000 3,000 3,000 0 6,000 12,000 1,000 1,000 1,000 3,000 3,000 4,000 4,000 4,000 4,000 100 500 700 800 800 800
Following are costs for eight different items. Costs are shown for three different levels of units produced and sold. Classify each of the eight cost items as either variable, fixed, or mixed. Costs for Different Levels of Units Produced and Sold Direct labor Depreciation on factory equipment Direct materials. Rent on factory building Salesperson compensation Factory supervisor salary Factory utilities Insurance on factory building Direct labor Depreciation on factory equipment Direct materials Rent on factory building Salesperson compensation Factory supervisor salary Factory utilities Insurance on factory building At 0 units $0 6,800 0 4,800 6,800 7,800 480 1,750 At 2,000 units At 4,000 units $ 13,800 6,800 $ 27,600 6,800 19,600 4,800 9,800 7,800 7,800 1,080 1,750 4,800 6,800 7,800 880 1,750 2
Overhead costs are assigned to each product based on ________.A. the proportion of that product’s use of the cost driverB. a predetermined overhead rate for a single cost driverC. price of the productD. machine hours per product
Overhead costs are assigned to each product based on ________. Group of answer choices A. the proportion of that product’s use of the cost driver B. a predetermined overhead rate for a single cost driver C. price of the product D. machine hours per product
Ayala Inc. has conducted the following analysis related to its product lines, using a traditional costing system (volume-based) and an activity-based costing system. Both the traditional and the activity-based costing systems include direct materials and direct labor costs. Products Product 540X Product 137Y Product 2495 Sales Revenue $208,000 155,000 92.000 Total Costs Traditional $54,000 48,000 23.000 ABC $49,000 30,000 46,000
Learned Corporation has provided the following information: Direct materials. Direct labor Variable manufacturing overhead Fixed manufacturing overhead Sales commissions a. Total product cost b. Total period cost Cost per Unit Cost per Period $ 5.80 $ 4.00 $ 1.60 c. Contribution margin per unit d. Total direct manufacturing cost e. Total indirect manufacturing cost $ 0.70 $ 0.60 Variable administrative expense Fixed selling and administrative expense Required: a. For financial reporting purposes, what is the total amount of product costs incurred to make 6,000 units? b. For financial reporting purposes, what is the total amount of period costs incurred to sell 6,000 units? c. If the selling price is $23.30 per unit, what is the contribution margin per unit sold? Note: Round your answer to 2 decimal places. d. If 7,000 units are produced, what is the total amount of direct manufacturing cost incurred? e. If 7,000 units are produced, what is the total amount of indirect manufacturing…
Ohno Company specializes in manufacturing a unique model of bicycle helmet. The model is well accepted by consumers, and the company has enough orders to keep the factory production at 10,000 helmets per month (80% of its full capacity). Ohno's monthly manufacturing cost and other expense data are as follows. Rent on factory equipment $1,600 Insurance on factory building 2,500 Raw materials (plastics, polystyrene, etc.) 79,700 Utility costs for factory 900 Supplies for general office 300 Wages for assembly line workers 63,700 Depreciation on office equipment 800 Miscellaneous materials (glue, thread, etc) 1,200 Factory manager's salary 6,400 Property taxes on factory building 500 Advertising for helmets 14,500 Sales commissions 10,600 Depreciation on factory building 1,600 (a)
What is the difference in the cost of Widget A, per product, using a traditional labor allocation vs. activity based costing method, assuming the three main cost activities are: Widget A Widget B Total Direct labor hours 300 600 900 Machine hours 100 150 250 Purchase orders = 50 50 100 Here are the summary of fixed costs to consider allocating: Payroll taxes $1,700 Machine maintenance $750 Purchasing Dept. labor $3.500 Fringe benefits $1.500 Purchasing Dept. Supplies $300 Equipment depreciation $1,000 Electricity $1,500 Unemployment insurance $1,300 Traditional method OVER estimates the cost of Product A by $850 Traditional method UNDER estimates the cost of Product A by $850 Traditional method OVER estimates the cost of Product A by $1600 O Traditional method UNDER estimates the cost of Product A by $1600
Harbour Company makes two models of electronic tablets, the Home and the Work. Basic production information follows: Home Work $ 40 17 $ 66 Direct materials cost per unit Direct labor cost per unit Sales price per unit Expected production per nonth 32 363 574 620 units 330 units Harbour has monthly overhead of $186,075, which is divided into the following cost pools: $ 91,300 53,975 40,800 Setup costs Quality control Maintenance Total $186,075 The company has also compiled the following information about the chosen cost drivers: Work Total Home 38 Number of setups Number of inspections Number of machine hours 1,600 72 110 330 305 635 1,800 3,400 Required: 1. Suppose Harbour uses a traditional costing system with machine hours as the cost driver. Determine the amount of overhead assigned to each product line. (Do not round intermediate calculations and round your final answers to the nearest whole dollar amount.) Overhead Assigned Home Model: Work Model: Total Overhead Cost 2. Calculate…
Suki Company uses activity-based costing to compute product costs for external reports. The company has three activity cost pools and applies overhead using predetermined overhead rates for each activity cost pool. Estimated costs and activities for the current year are presented below for the three activity cost pools: Estimated Overhead Cost Activity 1 Activity 2 Activity 3 Actual activity for the current year was as follows: Actual Activity Activity 1 Activity 2 Activity 3 $34,300 $20,520 $36,112 O a. $30,026.50 O b. $36,112.00 OC. $36,107.00 O d. $35,773.45 1,415 1,805 1,585 0 Expected Activity 1,400 1,800 1,600 The amount of overhead applied for Activity 3 during the year was closest to: Ø