Homework answers / question archive / Activity Machine setups Material handling Hazardous waste control Budgeted overhead cost $300000 150000 75000 Activity driver No

Activity Machine setups Material handling Hazardous waste control Budgeted overhead cost $300000 150000 75000 Activity driver No

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Activity Machine setups Material handling Hazardous waste control Budgeted overhead cost $300000 150000 75000 Activity driver No. of setups Weight of raw material Weight of hazardous chemicals used No. of inspections Machine hours Budgeted level for activity driver 100 50000 kilograms 10000 kilograms Cost per unit of activity driver $3000 per setup $3 per kilogram $7.50 per kilogram Quality control Other overhead costs Total 112500 300000 $937 500 1000 20000 $112.50 per inspection $15 per machine hour An order for 1000 boxes of film development chemicals has the following production requirements: Machine setups Raw material Hazardous materials Inspections Machine hours 4 setups 10000 kilograms 2000 kilograms 10 inspections 500 machine hours Required: 1. Calculate the total overhead that should be assigned to the order for development chemicals. 2. What is the overhead cost per box of chemicals?
Machine hours 500 machine hours Required: 1. Calculate the total overhead that should be assigned to the order for development chemicals. 2. What is the overhead cost per box of chemicals? 392 PART TWO COSTS AND COSTING SYSTEMS 3. If Snappy Photographic Supply were to use a plantwide predetermined overhead rate based on machine hours, calculate the rate per hour. 4. Under the approach in requirement 3, how much overhead would be assigned to the order for development chemicals: (a) in total (b) per box of chemicals? 5. Explain why these two product costing systems result in such widely differing costs. Which system do you recommend? Why? 6. Calculate the unit cost of a production order for 100 specially coated plates used in film development. In addition to direct material costing $180 per plate and direct labour costing $60 per plate, the order requires the following: Machine setups Raw material Hazardous materials Inspections Machine hours 2 setups 800 kilograms 300 kilograms 3 inspections 50 machine hours