vaghela1 Student questionJava Source, Incorporated, (JSI) roasts, blends, and packages coffee beans for resale. Some of JSI's coffees sell in large volumes, while some newer blends sell in very low volumes. JSI prices its coffees at manufacturing cost plus a markup of 25%.For next year, JSI's budget includes estimated manufacturing overhead cost of $3,020,600. JSI allocates manufacturing overhead to products using direct labor-hours. The expected direct labor cost totals $612,000, which represents 51,000 hours of direct labor time.The expected direct materials and direct labor costs for one-pound bags of two of the company's coffee blends appear below.Kenya Dark Viet SelectDirect materials$ 4.40$ 3.20Direct labor (0.030 hour per bag) $ 0.36JSI's controller believes the company's traditional costing system may be providing misleading cost information; therefore, he gathered the following activity-based cost information:Activity Cost PoolActivity MeasureExpected Activity for the Year Expected Cost for the YearPurchasingPurchase orders1,740ordersNumber of setups1,770Number of batches 580Material handlingQuality controlRoastingBlendingPackagingExpected production and sales 96,0009,600Batch sizeRoasting hoursBlending hoursPackaging hours3$ 0.36SetupsPurchase order size 19,200Roasting time per 100 pounds 1.5Blending time per 100 pounds 0.5Packaging time per 100 pounds 0.395,60033,100Total manufacturing overhead costData regarding the expected production and sales of Kenya Dark and Viet Select coffee are presented below.Kenya Dark Viet Selectpoundspoundsper batch26,3003,000 pounds6003pounds.roasting hours 1.5blending hour 0.5packaging hour 0.3600setupsbatchespoundsper batchpoundsroasting hoursblending hourpackaging hourroasting hoursblending hourspackaging hoursRequired:1. Using direct labor-hours as the manufacturing overhead cost allocation base:1. Calculate the plantwide predetermined overhead rate.2. Calculate the unit product cost of one pound of Kenya Dark and one pound of Viet Select.2. Using the activity-based absorption costing approach:1. Calculate the total manufacturing overhead cost allocated to Kenya Dark and Viet Select.$ 504,600708,000139,200956,000397,200315,600$ 3,020,600Tim2. Using the data developed in (2a) above, compute Kenya Dark's and Viet Select's manufacturing overhead cost per pound.3. Calculate the unit product cost of one pound of Kenya Dark and one pound of Viet Select.Activate Window:Go to Settings to activa

The plantwide overhead rate is a single predetermined overhead rate that a company uses to allocate…

Data regarding the expected production and sales of Kenya Dark and Viet Select coffee are presented below. Kenya Dark Viet Select pounds Expected production and sales 96,000 9,600 pounds per batch 3 600 pounds roasting hours 1.5 blending hour 0.5 packaging hour 0.3 Batch size Setups 19,200 Purchase order size Roasting time per 100 pounds 1.5 Blending time per 100 pounds 0.5 Packaging time per 100 pounds 0.3 3,000 pounds pounds 600 3 per batch pounds roasting hours: blending hour packaging hour Required: 1. Using direct labor-hours as the manufacturing overhead cost allocation base: 1. Calculate the plantwide predetermined overhead rate. 2. Calculate the unit product cost of one pound of Kenya Dark and one pound of Viet Select. 2. Using the activity-based absorption costing approach: 1. Calculate the total manufacturing overhead cost allocated to Kenya Dark and Viet Select. 2. Using the data developed in (2a) above, compute Kenya Dark's and Viet Select's manufacturing overhead cost per pound. 3. Calculate the unit product cost of one pound of Kenya Dark and one pound of Viet Select. Activate Wind Go to Settings to a

Data regarding the expected production and sales of Kenya Dark and Viet Select coffee are presented below. Kenya Dark Viet Select pounds Expected production and sales 96,000 9,600 pounds per batch 3 600 pounds roasting hours 1.5 blending hour 0.5 packaging hour 0.3 Batch size Setups 19,200 Purchase order size Roasting time per 100 pounds 1.5 Blending time per 100 pounds 0.5 Packaging time per 100 pounds 0.3 3,000 pounds pounds 600 3 per batch pounds roasting hours: blending hour packaging hour Required: 1. Using direct labor-hours as the manufacturing overhead cost allocation base: 1. Calculate the plantwide predetermined overhead rate. 2. Calculate the unit product cost of one pound of Kenya Dark and one pound of Viet Select. 2. Using the activity-based absorption costing approach: 1. Calculate the total manufacturing overhead cost allocated to Kenya Dark and Viet Select. 2. Using the data developed in (2a) above, compute Kenya Dark's and Viet Select's manufacturing overhead cost per pound. 3. Calculate the unit product cost of one pound of Kenya Dark and one pound of Viet Select. Activate Wind Go to Settings to a

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter8: Budgeting

Section: Chapter Questions

Problem 4CMA: Krouse Company produces two products, forged putter heads and laminated putter heads, which are sold...

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Krouse Company produces two products, forged putter heads and laminated putter heads, which are sold through specialty golf shops. The company is in the process of developing itsoperating budget for the coming year. Selected data regarding the companys two products areas follows: Manufacturing overhead is applied to units using direct labor hours. Variable manufacturing overhead Ls projected to be 25,000, and fixed manufacturing overhead is expected to be15,000. The estimated cost to produce one unit of the laminated putter head is: a. 42. b. 46. c. 52. d. 62.
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Crede Inc. has two divisions. Division A makes and sells student desks. Division B manufactures and sells reading lamps. Each desk has a reading lamp as one of its components. Division A can purchase reading lamps at a cost of $10.10 from an outside vendor. Division A needs 11,100 lamps for the coming year. Division B has the capacity to manufacture 49,600 lamps annually. Sales to outside customers are estimated at 38,500 lamps for the next year. Reading lamps are sold at $12.09 each. Variable costs are $6.87 per lamp and include $1.41 of variable sales costs that are not incurred if lamps are sold internally to Division A. The total amount of fixed costs for Division B is $75,900. Consider the following independent situations. What should be the minimum transfer price accepted by Division B for the 11,100 lamps and the maximum transfer price paid by Division A? (Round answers to 2 decimal places, e.g. 15.25.) Per unit Minimum transfer price accepted by Division B $_ Maximum transfer…
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Zachary manufacturing company makes tents that it sells directly to camping enthusiasts through a mail-order marketing program. The company pays a quality control expert $121600 per year to inspect completed tents before they are shipped to customers. assume that the company completed 1,530 tents in January and 1,240 tents in February. For the entire year, the company expects to produce 19000 tents. required c) If the cost objective is to determine the cost per tent, is the expert's salary a direct or an indirect cost? D) How much of the expert's salary should be allocated to tents produced in January and February? If the cost objective is to determine the cost per tent is the expert's salary a direct or an indirect cost?
Java Source, Inc., (JSI) buys coffee beans from around the world and roasts, blends, and packages them for resale. Some of JSI’s coffees are very popular and sell in large volumes, while a few of the newer blends sell in very low volumes. JSI prices its coffees at manufacturing cost plus a markup of 25%. For the coming year, JSI’s budget includes estimated manufacturing overhead cost of $2,200,000. JSI assigns manufacturing overhead to products on the basis of direct labor-hours. The expected direct labor cost totals $600,000, which represents 50,000 hours of direct labor time. The expected costs for direct materials and direct labor for one-pound bags of two of the company’s coffee products appear below. Kenya Dark Viet Select Direct materials 4.5 2.90 Direct labor (0.02 hours per bag) 0.34 0.34 JSI’s controller believes that the company’s traditional costing system may be providing misleading cost information. To determine whether or not this is…
Munoz Manufacturing Company makes tents that it sells directly to camping enthusiasts through a mail-order marketing program. The company pays a quality control expert $77,050 per year to inspect completed tents before they are shipped to customers. Assume that the company completed 1,690 tents in January and 1,300 tents in February. For the entire year, the company expects to produce 11,500 tents. If the cost objective is to determine the cost per tent, is the expert’s salary a direct or an indirect cost? How much of the expert’s salary should be allocated to tents produced in January and February?
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The Peace Department of Shalom Company uses 5,000 kilograms per month in its production of Peace products. It presently buys all the kilograms of materials it needs from outside supplier at a cost of P100. The Piss Division of Shalom Company manufactures the exact type of material that the Peace Department requires. The Piss Division is operating at its capacity of 15,000 units per month and sells all its output to a local manufacturer at P108 per unit. The following cost data are available for its 15,000 units: Variable production costs All fixed costs 70 10 If Piss Division sells all units to the local manufacturer, will it accept Peace's offer at P75? Yes or no? Use the underlined words as your choice. Input answers in capital letters.
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