e Calculate the total overhead cost assigned to Model V and Z using the

E calculate the total overhead cost assigned to model

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e. Calculate the total overhead cost assigned to Model V and Z using the approximately relevant ABC system based on only the two most expensive activities. Round to 2 decimal places) f. State the set of equations using the equally accurate reduced ABC system based on the consumption ratios for labor related costs and setups (round to 2 decimal places). 201. Funland Manufacturing Company 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. In addition, there is a sustaining process with two activities: providing utilities (plantwide) and providing space. Costs have been assigned to each activity using direct tracing and resource drivers: Engineering $125,000 Setups 112,500 Machining 250,000 Inspection 100,000 Providing space 31,250
Providing utilities 22,500 Activity drivers for each activity have been identified and their practical capacities listed: Machine hours 50,000 Setups 400 Engineering hours 10,000 Inspection hours 5,000 The cost of unit-level activities are assigned using machine hours The costs of batch-level activities are assigned using number of setups. The costs of facility-level activities are assigned using machine hours. Required : a. Identify the activities within each process as unit-level, batch-level, product-level, or facility-level. b. Build an activity relational table. c. Compute the pool rates (round to two decimal places). 202. Harrison 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. In addition, there is a sustaining process with two activities: providing utilities (plantwide) and providing space. Costs have been assigned to each activity using direct tracing and resource drivers: Engineering $250,000 Setups 225,000 Machining 500,000 Inspection 200,000 Providing space 62,500 Providing utilities 45,000 Activity drivers for each activity have been identified and their practical capacities listed: Machine hours 25,000 Setups 200 Engineering hours 5,000 Inspection hours 2,500
The cost of unit-level activities are assigned using machine hours The costs of batch-level activities are assigned using number of setups.

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