How do I determine the cost of one unit each of SW100 and SG150, assuming a company wide overhead rate is used based on total machine hours? Round rate to two decimal places.
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Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
How do I determine the cost of one unit each of SW100 and SG150, assuming a company wide overhead rate is used based on total machine hours? Round rate to two decimal places.
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- Activity-Based Costing Steampunk Corporation has the following predicted indirect costs and cost drivers for 2019 for the given activity cost pools: FabricationDepartment FinishingDepartment Cost Driver Maintenance $ 36,000 18,000 Machine hours Materials handling 54,000 27,000 Material moves Machine 126,000 9,000 Machine setups Inspections - 45,000 Inspection hours Total $ 216,000 $ 99,000 The following activity predictions were also made for the year: FabricationDepartment FinishingDepartment Machine hours 5,000 2,500 Material moves 1,500 750 Machine setups 350 25 Inspection hours - 500 It is assumed that the cost per unit of activity for a given activity does not vary between departments. Steampunk's president, Abner Punk, is trying to evaluate the company's product mix strategy regarding two of its product models, SW100 and SG150. The company has been using a company wide overhead rate based on machine hours but is considering…Activity-Based Costing Steampunk Corporation has the following predicted indirect costs and cost drivers for 2019 for the given activity cost pools: FabricationDepartment FinishingDepartment Cost Driver Maintenance $ 84,000 42,000 Machine hours Materials handling 126,000 63,000 Material moves Machine 294,000 21,000 Machine setups Inspections - 105,000 Inspection hours Total $ 504,000 $ 231,000 The following activity predictions were also made for the year: FabricationDepartment FinishingDepartment Machine hours 5,000 2,500 Material moves 1,500 750 Machine setups 350 25 Inspection hours - 500 It is assumed that the cost per unit of activity for a given activity does not vary between departments. Steampunk's president, Abner Punk, is trying to evaluate the company's product mix strategy regarding two of its product models, SW100 and SG150. The company has been using a company wide overhead rate based on machine hours but is considering…In 2020 the budget for a machine shop showed overheads of $60,000 and volume of activity of12,000 machine hours.In January of 2020, the machine shop incurred $5,400 of overhead and 1,050 machine hourswere worked. Required:a. Determine:i. The predetermined absorption rate. ii. The under/over absorption rate. b. With the use of calculation, explain the factors that contributed to the under/over absorptionof overheads.
- Activity-Based Costing Steampunk Corporation has the following predicted indirect costs and cost drivers for the upcoming year for the given activity cost pools: Fabrication Finishing Department Department Cost Driver $ 30,000 15,000 Machine hours 22,500 Material moves 45,000 105,000 7,500 Machine setups 37,500 Inspection hours Total $180,000 $82,500 The following activity predictions were also made for the year: Maintenance Materials handling Machine Inspections Fabrication Finishing Department Department 5,000 2,500 1,500 750 25 500 It is assumed that the cost per unit of activity for a given activity does not vary between departments. Steampunk's president, Abner Punk, is trying to evaluate the company's product mix strategy regarding two of its product models, SW100 and SG150. The company has been using a company wide overhead rate based on machine hours but is considering switching to either department rates of activity-based rates: The production manager has provided the…Activity-Based Costing Slack Corporation has the following predicted indirect costs and cost drivers for the year for the given activity cost pools: Maintenance Materials handling Machine setups Inspections Machine hours Material moves Machine setups Inspection hours Fabrication Department Finishing Department Cost Driver Machine hours Material moves Direct materials cost Direct labor cost Machine hours (Fabrication) Machine hours (Finishing) Materials moves Machine setups Inspection hours $150,000 The following activity predictions were also made for the year: Fabrication Department Finishing Department Direct materials Direct labor $50,000 30,000 70,000 It is assumed that the cost per unit of activity for a given activity does not vary between departments. Slack's president, Charles Slack, is trying to evaluate the company's product mix strategy regarding two of its five product models, ZX300 and SL500. The company has been using a company- wide overhead rate based on machine hours…A company estimates its manufacturing overhead will be $630,000 for the next year. What is the predetermined overhead rate given the following independent allocation bases? When required, round your answers to nearest cent. A. Budgeted direct labor hours: 72,000 $______ per direct labor hour B. Budgeted direct labor expense: $1,800,000 $_____ per direct labor dollar C. Estimated machine hours: 120,000 $_____ per machine hour
- XYZ Motors Corporation has identified activity centers to which overhead costs are assigned. The cost pool amounts for these centers and their selected cost drivers for 2018 are as follows: Activity Center - Utilities: Cost - P600,000 Cost Driver - 30,000 machine hours Activity Center - Scheduling sand setups Cost - P546,000 Cost Driver - 390 setups Activity Center - Material handling Cost - P1,280,000 Cost Driver - 800,000 kilos of materials The company's products and other operating statistics are as follows: Product A: Direct costs - P40,000 Machine hours - 15,000 Number of setups - 65 Kilos of material - 250,000 Number of units produced - 20,000 Direct labor hours - 16,000 Product B: Direct costs - P40,000 Machine hours - 5,000 Number of setups - 190 Kilos of material - 150,000 Number of units produced - 10,000 Direct labor hours - 9,000 Product C: Direct costs - P45,000 Machine hours - 10,000 Number of setups - 135 Kilos of material - 400,000 Number of units produced -…Activity-Based Costing Slack Corporation has the following predicted indirect costs and cost drivers for the year for the given activity cost pools: Maintenance Materials handling Machine setups Inspections Machine hours Material moves Machine setups Inspection hours Fabrication Department Finishing Department Cost Driver $50,000 30,000 70,000 $40,000 Machine hours 15,000 Material moves 5,000 Machine setups 25,000 Inspection hours $85,000 The following activity predictions were also made for the year. Fabrication Department Finishing Department Direct materials cost Direct labor cost Machine hours (Fabrication) Machine hours (Finishing) Materials moves Machine setups Inspection hours It is assumed that the cost per unit of activity for a given activity does not vary between departments. Slack's president, Charles Slack, is trying to evaluate the company's product mix strategy regardin two of its five product models, ZX300 and SL500. The company has been using a company-wide overhead…A company estimates its manufacturing overhead will be $1,080,000 for the next year. What is the predetermined overhead rate given the following independent allocation bases? When required, round your answers to nearest cent. A. Budgeted direct labor hours: 72,000 $fill in the blank 1 per direct labor hour B. Budgeted direct labor expense: $1,800,000 $fill in the blank 2 per direct labor dollar C. Estimated machine hours: 120,000 $fill in the blank 3 per machine hour
- The cost formula for the maintenance department of Rambo Limited is $19,200 per month plus $7.50 per machine hour used by the production department. Required: a. Calculate the maintenance cost that would be budgeted for a month in which 6,600 machine hours are planned to be used. b. Prepare an appropriate performance report for the maintenance department assuming that 7,100 machine hours would be used in the month of May and that the total actual maintenance cost incurred in May was $68,950. Complete this question by entering your answers in the tabs below. Required A Required B Calculate the maintenance cost that would be budgeted for a month in which 6,600 machine hours are planned to be used. Maintenance costJYD Corporation has identified activity centers to which overhead cost are assigned. The cost pool amounts for these centers and their selected activity drivers for 2021 follows: Activity Centers Costs Activity Drivers Set-ups $310,000 12,400 set-ups Utilities 475,000 62,500 machine hours No. of parts 160,000 8,000 parts Direct costs of producing product X amounted to P37,500. The said product took 8,500 direct labor hours and 7,500 machine hours to finish. Also, the product needed 3,750 set-ups and 275 parts to complete. 12,500 units of product X were produced during 2021. a. How much was the full cost per unit of product X using Activity Based Costing?Fulcrum Industries manufactures dining chairs and tables. The following information is available in December 2020: Dining Chairs Tables Total CostMachine setups 200 600 $48,000Inspections 250 470 $72,000Labor hours 2,600 2,400 Fulcrum is considering switching from one overhead rate based on labor hours to activity-based costing.InstructionsPerform the following analyses for these two components of overhead:a. Compute total machine setups and inspection costs assigned to each product, using a single overhead rate.b. Compute total machine setups and inspection costs assigned to each product, using activity-based costing.c. Comment on your findings.