Chapter 6 solutions to inclass problems

# Chapter 6 solutions to inclass problems - M6-131 i6 d2 h7...

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Unformatted text preview: M6-131. i6. d2. h7. b*3. f8. c4. a9. e5. j10. gM6-16The easiest way to solve this assignment is to classify each of the activities Brenda performed as unit, batch, product, or facility level. Next, total the percentages in each category. Finally, multiply the percentages by Brenda’s salary.Assignment ofSalaryUnit level:Supervising production20percentTotal20\$25,000Batch level:Job scheduling18 percentSupervising setup5 percentFirst unit inspection2percentTotal2531,250Product level:Product design15 percentPreparing bills of materials5 percentPreparing operations lists10percentTotal3037,500Facility level:Employee training15 percentFacility maintenance7 percentAttending professional meetings3percentTotal2531,250Grand total100\$125,000M6-19Activity cost calculations:Machine setup cost = \$600,000 ÷12,000 setup hours = \$50 per setup hourMaterial handling cost = \$120,000 ÷2,000 tons = \$60 per ton of materialsMachine operation = \$500,000 ÷10,000 = \$50 per machine hourProduct costs:C23 CamsU2 ShaftsDirect materials \$30,000\$20,000Direct labor5,00010,000Manufacturing overhead:Machine setups (3 setup hours ×\$50)150(7 setup hours ×\$50)350Material handling (12.5 tons ×\$60)750 (8 tons ×\$60)480Machine operation (4 hours ×\$50)200(5 machine hours ×\$50)250Total job costs\$36,100\$31,080Units produced÷500÷300Cost per unit produced\$ 72.20\$103.60E6-27a.Total overhead costs:Setup\$ 900,000Ordering240,000Maintenance1,200,000Power120,000\$2,460,000Direct labor hours÷ 60,000Overhead cost per direct labor hour\$ 41Job cost calculations:Job 201Job 202Direct materials\$13,500\$15,000Direct labor18,00071,250Overhead (\$41 × 270) and (\$41 × 330) 11,07013,530\$42,570\$99,780Units produced÷ 1,125÷ 900Cost per unit\$37.84\$110.87b.Calculation of activity costs:Setup costs \$900,000 ÷ 7,200 setups = \$125 per setupOrdering costs \$240,000 ÷ 60,000 orders = \$4 per orderMaintenance costs \$1,200,000 ÷ 96,000 mach. hours = \$12.5 per mach. hr.Power \$120,000 ÷ 600,000 kilowatt hours = \$0.20 per kwhJob cost calculations:Job 201Job 202Direct materials\$13,500\$15,000Direct labor18,00071,250Setup cost (\$125 × 18) and (\$125 × 22)2,2502,750Ordering costs (\$4 × 24) and (\$4 × 45)96180Maintenance costs (\$12.5 × 540) &6,750(\$12.5 × 450)5,625Power (\$0.20 × 270) and (\$0.20 × 360)5472Total job costs\$40,650\$94,877Units produced÷ 1,125÷ 900Cost per unit\$36.13\$105.42E6-27 (cont.)c. In addition to the manufacturing cost information provided by ABC, management will need to have additional information about non-manufacturing costs such as distribution and customer service....
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Chapter 6 solutions to inclass problems - M6-131 i6 d2 h7...

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