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Homework answers / question archive / The company produces a Standard and in 2020, gets to cur $1
The company produces a Standard and in 2020, gets to cur $1.350.000 of factory overhead. The following alte provides additional information regarding the sales Direct materials cost per unit Direct Labour cost per unit Total direct labour hours expected to be used Number of units expected to be produced Standard $14 $12 42. 70,000 $20 $12 48. 10. IDA wants to refine its costing system to be more competitive by introducing activity based costing. The following table summatimes the exinformation IDA 10 17 Activity Cost Pool Expected Activity Activity measure Setups Materials handling Equipment operations Number of setups Quantity of materials (kilograms) Machine-hours (MHs) Expected Overhead Cost $64,000 254,000 1.032.000 $1.350,000 Standard Dipital 220 100 30,000 33,500 32,000 54,000 Total 3201 63,500 86.000) otal quired: 1: Calculate the predetermined overhead rate based on direct labour hours and calculate the overhead cost per unit for each product. (3 m
Part 1: Calculate the predetermined everadrater Lased on the show hours and collate the desert boxech pro Standard Digital Overhead cost per unit 32 Part 2: Calculate the overhead cost per unit for each product using activity based costing marks) Standard Digital Overhead cost per unit
(A) based on predetermined over head absorption rate
Total overheads budgeted=1350000
Basis = labour hours
Total labour hours budgeted=42000+48000=90000
Overhead absorption rate per labor hour
=1350000/90000=15 per labor hour
* total overhead costs for standard product = 42000 hours*15 per hour=630000
Total production of standard =70000
Over head costs per standard type of product= 630000/70000=9 per unit
* overhead for digital product=48000 hours*15 per hour=720000
Total units of production of digital=40000
Per unit cost of over head=720000/40000=18
(B) activity based costing
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