Cullumber Fabrics has budgeted overhead costs of $1,098,880. It has allocated overhead on a plant-wide basis...
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Cullumber Fabrics has budgeted overhead costs of $1,098,880. It has allocated overhead on a plant-wide basis to its two products (wool and cotton) using direct labour hours, which are estimated to be 549,440 for the current year. The company has decided to experiment with activity-based costing and has created two activity cost pools and related activity cost drivers. These two cost pools are cutting (the cost driver is machine hours) and design (the cost driver is the number of set-ups). Total estimated machine hours is 203,490, and total estimated number of set-ups is 1,870. Overhead allocated to the cutting cost pool is $406,980 and $691,900 is allocated to the design cost pool. Additional information related to these pools is as follows: Wool Cotton Machine hours 106,100 97,390 Number of set-ups 1,410 460 (a) Determine the amount of overhead assigned to the wool product line and the cotton product line using activity-based costing. Wool Overhead assigned $ Cotton SUPPORT Cullumber Fabrics has budgeted overhead costs of $1,098,880. It has allocated overhead on a plant-wide basis to its two products (wool and cotton) using direct labour hours, which are estimated to be 549,440 for the current year. The company has decided to experiment with activity-based costing and has created two activity cost pools and related activity cost drivers. These two cost pools are cutting (the cost driver is machine hours) and design (the cost driver is the number of set-ups). Total estimated machine hours is 203,490, and total estimated number of set-ups is 1,870. Overhead allocated to the cutting cost pool is $406,980 and $691,900 is allocated to the design cost pool. Additional information related to these pools is as follows: Wool Cotton Machine hours 106,100 97,390 Number of set-ups 1,410 460 (a) Determine the amount of overhead assigned to the wool product line and the cotton product line using activity-based costing. Wool Overhead assigned $ Cotton SUPPORT
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Related Book For
Managerial Accounting Tools for Business Decision Making
ISBN: 978-1118856994
4th Canadian edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso, Ibrahim M. Aly
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