The Electronics Manufacturing Department of Imagine uses ABC to allocate all of its manufacturing overhead. The company

Question:

The Electronics Manufacturing Department of Imagine uses ABC to allocate all of its manufacturing overhead. The company assembles and tests electronic components used in handheld video phones. Consider the following data regarding component T24:

Direct materials cost.................................................................................. $51.00

Direct labour cost...................................................................................... $30.00

Manufacturing overhead allocated............................................................ ?

Manufacturing product cost...................................................................... $ ?

The activities required to build the component follow:

The Electronics Manufacturing Department of Imagine uses ABC to allocate

Requirements
1. Fill in the blanks in both the opening schedule and the list of activities.
2. Why might managers favour this ABC system instead of the older system, which allocated all MOH costs on the basis of direct labour?

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Related Book For  book-img-for-question

Managerial Accounting

ISBN: 978-0176223311

1st Canadian Edition

Authors: Karen Wilken Braun, Wendy Tietz, Walter Harrison, Rhonda Pyp

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