EcoFabrics has budgeted overhead costs of $1,171,800. It has assigned overhead on a plantwide basis to...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
EcoFabrics has budgeted overhead costs of $1,171,800. It has assigned overhead on a plantwide basis to its two products (wool and cotton) using direct labor hours which are estimated to be 558,000 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 (cost driver is machine hours) and design (cost driver is number of setups). Total estimated machine hours is 248,000, and total estimated number of setups is 1,860. Overhead allocated to the cutting cost pool is $446,400 and $725,400 is allocated to the design cost pool. Additional information related to product usage by these pools is as follows. Wool Cotton Machine hours 124,000 124,000 Number of setups 1.240 620 Calculate the overhead rate using activity based costing. (Round per machine hour to 2 decimal places, e.g. 12.25.) Overhead rates for activity-based costing Cutting $ Design $ per machine hour per setup Determine the amount of overhead assigned to the wool product line and the cotton product line using activity-based costing. Wool product line Cotton product line Overhead Allocated $ $ eTextbook and Media Calculate the overhead rate using traditional approach. (Round answer to 2 decimal places, e.g. 12.25.) Overhead rates using the traditional approach $ What amount of overhead would be assigned to the wool and cotton product lines using the traditional approach, assuming direct labor hours were incurred evenly between the wool and cotton? Overhead Allocated $ Wool product line Cotton product line pe EcoFabrics has budgeted overhead costs of $1,171,800. It has assigned overhead on a plantwide basis to its two products (wool and cotton) using direct labor hours which are estimated to be 558,000 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 (cost driver is machine hours) and design (cost driver is number of setups). Total estimated machine hours is 248,000, and total estimated number of setups is 1,860. Overhead allocated to the cutting cost pool is $446,400 and $725,400 is allocated to the design cost pool. Additional information related to product usage by these pools is as follows. Wool Cotton Machine hours 124,000 124,000 Number of setups 1.240 620 Calculate the overhead rate using activity based costing. (Round per machine hour to 2 decimal places, e.g. 12.25.) Overhead rates for activity-based costing Cutting $ Design $ per machine hour per setup Determine the amount of overhead assigned to the wool product line and the cotton product line using activity-based costing. Wool product line Cotton product line Overhead Allocated $ $ eTextbook and Media Calculate the overhead rate using traditional approach. (Round answer to 2 decimal places, e.g. 12.25.) Overhead rates using the traditional approach $ What amount of overhead would be assigned to the wool and cotton product lines using the traditional approach, assuming direct labor hours were incurred evenly between the wool and cotton? Overhead Allocated $ Wool product line Cotton product line pe
Expert Answer:
Answer rating: 100% (QA)
To calculate the overhead rate using activitybased costing ABC we need to divide the overhead allocated to each cost pool by the total activity driver ... View the full answer
Related Book For
Financial and Managerial Accounting
ISBN: 978-1118334263
2nd edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
Posted Date:
Students also viewed these accounting questions
-
EcoFabrics has budgeted overhead costs of $945,000. It has allocated overhead on a plantwide basis to its two products (wool and cotton) using direct labor hours which are estimated to be 450,000 for...
-
EcoFabrics has budgeted overhead costs of $1,143,450. It has allocated overhead on a plantwide basis to its two products (wool and cotton) using direct labor hours which are estimated to be 544,500...
-
Investigate the recycling policy in the city where you live. How might you interpret the policy using the concepts or policy criteria presented in this chapter?
-
In this exercise, you will prove that, as long as tastes satisfy rationality, continuity and monotoni city, there always exists a well-defined indifference map (and utility function) that can...
-
Wiley Company had total revenues of $360,000 for a recent month. During the month the company incurred operating expenses of $246,000 and purchased land for $66,000. Compute the amount of Wiley's net...
-
What are the steps of the Component SelectionMethodology?
-
Rocky Plain Company provides cable and Internet services in the greater Denver area. There are many competitors that provide similar services. Rocky Plain believes that the key to financial success...
-
Suppose the speed is 1800 rpm and the torque is 20ft-lbs.Determine the horsepower and output watts.
-
if there is a negative liaiblity -50 and its moved to assets +50 in error. to reduce this back is it credit assets, and debit liability by 50? It showed as a negative in liability but it showed as a...
-
Discussion: Are Facebook friends the same as real friends? Are Facebook fans real fans? Explain.
-
What is social media marketing? What marketing objectives can organizations meet when they incorporate social media in their marketing mix?
-
How does information flow in a network?
-
A statement of financial position is to be drawn up from the following information as at 30 September 2011: Issued share capital: ordinary shares 1 each Authorised share capital: ordinary shares of 1...
-
Draw up a statement of cash flows for Gerry Peace for the year ending 31 December 2013 using the IAS 7 layout. You are told that fixtures bought in 2003 cost 400, whilst a van was bought for 5,500....
-
1. Corinne's employer offers a cafeteria plan that allows employees to choose among a number of benefits. Each employee is allowed $12,000 in benefits. For the current year, Corinne selected $4,500...
-
A copper sphere of 10-mm diameter, initially at a prescribed elevated temperature T;, is quenched in a saturated (1 atm) water bath. Using the lumped capacitance method, estimate the time for the...
-
There are 35 students in a class. Fifteen of them are men and 20 of them are women. The mean height of the men is 69.65 inches and the mean height of all 35 students is 66.85 inches. What is the mean...
-
There are two sections of an elementary statistics course. Section A has 25 students and section B has 35 students. All students took the same final exam. The mean score in section A was 72 and the...
-
A data set has a median of 17, and six of the numbers in the data set are less than 17. The data set contains a total of n numbers. a. If n is odd, and exactly one number in the data set is equal to...
Study smarter with the SolutionInn App