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1 d out of Given the following information for the standard and special jobs during 2019: Standard Special Cost Driver Total costs Number of jobs 400 200 machine hour per job 10 10 setup hours per job 4 7 Machine operations machine hour $150,000 Setups setup hours $ 90,000 Purchase orders 400 500 # of purchases $ 36,000 Using ABC costing, allocated setup cost for each standard job will be ---- 2 Given the following information for the standard and special jobs during 2019: Standard Special Driver Total costs Number of jobs 450 250 machine hour per job 10 10 setup hours per job 7 Machine operations machine hour $150,000 Setups setup hours $ 90,000 Purchase orders 500 500 # of purchases $ 36,000 4 Using ABC costing, overhead cost of each standard job will be A- 1 B ili III OP
1
d out of Given the following information for the standard and special jobs during 2019: Standard Special Cost Driver Total costs Number of jobs 400 200 machine hour per job 10 10 setup hours per job 4 7 Machine operations machine hour $150,000 Setups setup hours $ 90,000 Purchase orders 400 500 # of purchases $ 36,000 Using ABC costing, allocated setup cost for each standard job will be ----
2
Given the following information for the standard and special jobs during 2019: Standard Special Driver Total costs Number of jobs 450 250 machine hour per job 10 10 setup hours per job 7 Machine operations machine hour $150,000 Setups setup hours $ 90,000 Purchase orders 500 500 # of purchases $ 36,000 4 Using ABC costing, overhead cost of each standard job will be A- 1 B ili III OP
Expert Solution
1
| Particulars | Standard | Special | Total | Cost | Cost per cost driver | Standard | Special |
| A | B | C = A + B | D | E = D / C | A X E | B X E | |
| Machine hours | 4,000 | 2,000 | 6,000 | $ 150,000 | $ 25.00 | 100,000 | 50,000 |
| Setup Hours | 1,600 | 1,400 | 3,000 | $ 90,000 | $ 30.00 | 48,000 | 42,000 |
| Purchase orders | 400 | 500 | 900 | $ 36,000 | $ 40.00 | 16,000 | 20,000 |
Allocated setup cost for each standard job = 48,000 / 400 = $120 per job ($30 X 4 hours)
2
Answer:
| Standard | Special | ||||
| Rate | Usage | Allocation | Usage | Allocation | |
| Machine operation cost | $ 21.43 | 4500 | $ 96,429 | 2500 | $ 53,571 |
| Setups Cost | $ 25.35 | 1800 | $ 45,634 | 1750 | $ 44,366 |
| Purchase orders cost | $ 36.00 | 500 | $ 18,000 | 500 | $ 18,000 |
| Total overhead cost | $ 160,062 | $ 115,938 | |||
| Number of jobs | 450 | 250 | |||
| Overhead cost per job | $ 355.69 | $ 463.75 |
Working:
| Activity Cost Pool | Overhead Costs | Total cost drivers | Activity Rate | |
| Machine operation cost | $ 150,000 | 7,000 | $ 21.43 | per machine hour |
| Setups Cost | $ 90,000 | 3,550 | $ 25.35 | per setup |
| Purchase orders cost | $ 36,000 | 1,000 | $ 36.00 | per order |
| Calculation of usage: | |||
| Job Type | Standard | Special | Total |
| Number of jobs | 450 | 250 | |
| Machine hour per job | 10 | 10 | |
| Total machine hours | 4500 | 2500 | 7,000 |
| Set up hours per job | 4 | 7 | |
| Total set up hours | 1800 | 1750 | 3,550 |
| Purchase orders | 500 | 500 | 1,000 |
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