Smoky Mountain Corporation makes two types of hiking boots-the Xtreme and the Pathfinder. Data concerning these...
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Smoky Mountain Corporation makes two types of hiking boots-the Xtreme and the Pathfinder. Data concerning these two product lines appear below: Selling price per unit Xtreme $ 138.00 Direct materials per unit $ 64.40 Direct labor per unit $ 13.50 Pathfinder $ 90.00 $51.00 $ 9.00 Direct labor-hours per unit Estimated annual production and sales 1.5 DLHS 22,000 units 1.0 DLHS 73,000 units The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below: Estimated total manufacturing overhead Estimated total direct labor-hours Required: $ 2,438,000 106,000 DLHS 1. Compute the product margins for the Xtreme and the Pathfinder products under the company's traditional costing system. 2. The company is considering replacing its traditional costing system with an activity-based costing system that would assign its manufacturing overhead to the following four activity cost pools (the Other cost pool includes organization-sustaining costs and idle capacity costs): Activities and (Activity Measures) Supporting direct labor (direct labor-hours) Batch setups (setups) Estimated Overhead Cost $ 646,600 969,000 Product sustaining (number of products) Other Total manufacturing overhead cost Expected Activity Xtreme Pathfinder Total 33,000 73,000 106,000 330 240 570 780,000 1 1 2 42,400 NA NA NA $ 2,438,000 Compute the product margins for the Xtreme and the Pathfinder products under the activity-based costing system. 3. Prepare a quantitative comparison of the traditional and activity-based cost assignments. Complete this question by entering your answers in the tabs below. Required Required 2 Required 3 Compute the product margins for the Xtreme and the Pathfinder products under the company's traditional costing system. Note: Round your Intermediate calculations to 2 decimal places and final answers to the nearest whole dollar amount. Product margin Xtreme Pathfinder Total $ 0 Required 1 Required 2 > Smoky Mountain Corporation makes two types of hiking boots-the Xtreme and the Pathfinder. Data concerning these two product lines appear below: Selling price per unit Xtreme $ 138.00 Direct materials per unit $ 64.40 Direct labor per unit $ 13.50 Pathfinder $ 90.00 $51.00 $ 9.00 Direct labor-hours per unit Estimated annual production and sales 1.5 DLHS 22,000 units 1.0 DLHS 73,000 units The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below: Estimated total manufacturing overhead Estimated total direct labor-hours Required: $ 2,438,000 106,000 DLHS 1. Compute the product margins for the Xtreme and the Pathfinder products under the company's traditional costing system. 2. The company is considering replacing its traditional costing system with an activity-based costing system that would assign its manufacturing overhead to the following four activity cost pools (the Other cost pool includes organization-sustaining costs and idle capacity costs): Activities and (Activity Measures) Supporting direct labor (direct labor-hours) Batch setups (setups) Estimated Overhead Cost $ 646,600 969,000 Product sustaining (number of products) Other Total manufacturing overhead cost Expected Activity Xtreme Pathfinder Total 33,000 73,000 106,000 330 240 570 780,000 1 1 2 42,400 NA NA NA $ 2,438,000 Compute the product margins for the Xtreme and the Pathfinder products under the activity-based costing system. 3. Prepare a quantitative comparison of the traditional and activity-based cost assignments. Complete this question by entering your answers in the tabs below. Required Required 2 Required 3 Compute the product margins for the Xtreme and the Pathfinder products under the company's traditional costing system. Note: Round your Intermediate calculations to 2 decimal places and final answers to the nearest whole dollar amount. Product margin Xtreme Pathfinder Total $ 0 Required 1 Required 2 >
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Related Book For
Managerial Accounting
ISBN: 978-0697789938
13th Edition
Authors: Ray H. Garrison, Eric W. Noreen, Peter C. Brewer
Posted Date:
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