P4-4A - P4-4A: (a) Under traditional product costing using...

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Unformatted text preview: P4-4A: (a) Under traditional product costing using direct labor hours, compute the total manufacturing cost per liter of both prodcuts Overhead allocation rate Total Overhead Total Direct labor Hours Allocation Rate Manufacturing Cost Direct Material Direct Labor Overhead Total Manufacturing Cost: CoolDay LiteMist $0.400 $1.200 $0.250 $0.500 $0.428 $0.771 $1.078 $2.471 $1,241,660 $145,000 $8.563 (b) Under ABC prepare a schedule showing the computation of the activity-based overhead rates (per cost driver) Expected use of Cost Drivers Activity Cost Pools Cost Drivers Estimated Overhead Grape processing Aging Bottling and corking Labeling and boxing Maintain & inspect equipment Cart of Grapes Total months # of bottles # of bottles # of inspections $145,860 $396,000 $270,000 $189,000 $240,800 $1,241,660 6,600 6,600,000 900,000 900,000 800 (c) Prepare a schedule assigning each activity's overhead cost pool to each product, based on the use of cost drivers, include a computation of overhead cost per liter. Use of Cost Driver Cost Assigned Use of Cost Driver Activity Cost Pools Rate Rate LiteMist $22.10 $0.06 $0.30 $0.21 $301.00 Grape processing Aging Bottling and corking Labeling and boxing Maintain & inspect equipment Total Costs Liters Produced Overhead Cost per Liter CoolDay 6,000 $22.10 3,000,000 $0.06 600,000 $0.30 600,000 $0.21 350 $301.00 $132,600 $180,000 $180,000 $126,000 $105,350 $723,950 3,000,000 $0.241 600 3,600,000 300,000 300,000 450 (d) Compute the total manufacturing cost per liter for both products under ABC Manufacturing Cost Direct Material Direct Labor Overhead Total Manufacturing Cost CoolDay LiteMist $0.400 $1.200 $0.250 $0.500 $0.241 $1.726 $0.891 $3.426 nufacturing cost verhead rates Activity Based Overhead rate $22.10 $0.06 $0.30 $0.21 $301.00 t, based on the Cost Assigned $13,260 $216,000 $90,000 $63,000 $135,450 $517,710 300,000 $1.726 ...
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This note was uploaded on 09/20/2008 for the course ACC 363 taught by Professor Rossi during the Spring '08 term at University of Phoenix.

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P4-4A - P4-4A: (a) Under traditional product costing using...

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