# 163 figure 4 20 quasi tech corporation produces

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Chapter 2 / Exercise 46
Finite Mathematics for the Managerial, Life, and Social Sciences: An Applied Approach
Tan
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163. Figure 4-20Quasi-Tech Corporation produces specially machined parts. The parts are produced in batches in one continuous manufacturing process. Each part is custom produced and requires special engineering design activity (based on customer specifications). Once the design is completed, the equipment can be set up for batch production. Once the batch is completed, a sample is taken and inspected to see if the parts are within the tolerances allowed. Thus, the manufacturing process has four activities: engineering, setups, machining, and inspecting. Costs have been assigned to each activity using direct tracing and resource drivers:ActivityExpected CostActivity DriverActivity CapacityEngineering\$1,000,000engineering hours5,000 hoursSetups\$ 900,000setups200 setups
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Chapter 2 / Exercise 46
Finite Mathematics for the Managerial, Life, and Social Sciences: An Applied Approach
Tan
Expert Verified
Machining\$2,000,000machine hours25,000 machine hoursInspection\$ 800,000inspection hours2,500 inspection hoursOwens produces two models: Model X and Model Y. The following table shows how the two products consume activity.Model CModel DUnits completed300,000200,000Engineering hours1,0004,000Setups80120Machine hours20,0005,000Inspection hours1,5001,000Refer to Figure 4-20. First, determine the overhead costs assigned to model D using the two most expensive activities for cost pools. The costs of the two relatively inexpensive activities are allocated to the two most expensive activities in proportion to their costs. (Round to two decimal places.)What is the error in the overhead cost assigned to model D using ABC (4 driver model) as the benchmark?A. \$180,030B. \$240,700C. \$313,330D. \$626,650164. Figure 4-20Quasi-Tech Corporation produces specially machined parts. The parts are produced in batches in one continuous manufacturing process. Each part is custom produced and requires special engineering design activity (based on customer specifications). Once the design is completed, the equipment can be set up for batch production. Once the batch is completed, a sample is taken and inspected to see if the parts are within the tolerances allowed. Thus, the manufacturing process has four activities: engineering, setups, machining, and inspecting. Costs have been assigned to each activity using direct tracing and resource drivers:ActivityExpected CostActivity DriverActivity CapacityEngineering\$1,000,000engineering hours5,000 hoursSetups\$ 900,000setups200 setupsMachining\$2,000,000machine hours25,000 machine hoursInspection\$ 800,000inspection hours2,500 inspection hoursOwens produces two models: Model X and Model Y. The following table shows how the two products consume activity.Model CModel DUnits completed300,000200,000Engineering hours1,0004,000Setups80120Machine hours20,0005,000Inspection hours1,5001,000Refer to Figure 4-20. What are the global consumption ratios of Model C and D respectively? (round to two decimal places)A. 0.20; 0.80B. 0.42; 0.58C. 0.56; 0.44D. 0.84; 0.16165. Figure 4-20Quasi-Tech Corporation produces specially machined parts. The parts are produced in batches in one continuous manufacturing process. Each part is custom produced and requires special engineering design activity (based on customer specifications). Once the design is completed, the equipment can be set up for batch