Cost 6 - RS Company manufactures and distributes two...

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RS Company manufactures and distributes two products, R and S. Overhead costs are currently allocated using the number of units produced as the allocation base. The controller has recommended changing to an activity-based costing (ABC) system. She has collected the following information: Activity Cost Driver Amount R S Production setups Number of setups $82,000 8 12 Material handling Number of parts $48,000 56 24 Packaging costs Number of units $130,000 $80,000 $50,000 $260,000 What is the total overhead allocated to Product R using the current system? Answer Selected Answer: $160,000 Correct Answer: $160,000 Response Feedback: $260,000/130,000 = $2.00 per unit; $2(80,000) = $160,000 Question 2 2 out of 2 points Based on the information in question #1 what is the total overhead per unit allocated to Product S using activity-based costing (ABC)? Answer Selected Answer: $2.27 Correct Answer: $2.27 Response Feedback: ($82,000/20)12 + ($48,000/80)24 + ($130,000/130,000)50,000 = $113,600; $113,600/50,000 = $2.27 Question 3 2 out of 2 points
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Terri Martin Nerdmeister, CPA provides bookkeeping and tax services to her clients. She charges a fee of $60 per hour for bookkeeping and $90 per hour for tax services. Martin estimates the following costs for the upcoming year: Office Supplies $16,000 Computer fees $24,000 Secretary's salary $30,000 Rent $18,000 $88,000 Operating profits
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This note was uploaded on 11/22/2011 for the course COST ACCOU 101 taught by Professor Dennis during the Spring '11 term at Post.

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Cost 6 - RS Company manufactures and distributes two...

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