Blusteel Ltd manufactures Blu-ray players and uses an activity-based product costing system that assigns labour and overhead
Question:
Blusteel Ltd manufactures Blu-ray players and uses an activity-based product costing system that assigns labour and overhead costs. Below is an incomplete bill of activities for the high-volume product, BluStandard.
Bluesteel Ltd Bill of activities BluStandard
Activity _____________ Cost per unit of activity driver ______ Annual quantity of activity
_____________________________________________________ drivers used by the product
Process payables ................... $90 per purchase order ..................... 400 purchase order
Program production ........... $337.50 per production schedule ................... 100 schedules
Process sales order ................ $112.50 per sales order ......................... 300 sales orders
Issue materials ......................... $180 per issue ...................................... 100 issues
Set up solder machine ............... $237 per setup ...................................... 100 setups
Solder circuit boards .............. $22.50 per solder joint .................... 40 000 solder joints
Insert motor ............................ $45 per player ................................. 5 000 players
Assemble player ....................... $27 per player ................................. 5 000 players
Design player .................... Directly assigned cost of $18 000 for model BluStandard
Required:
1. Complete the bill of activities and estimate the total activity cost of the BluStandard player, calculated on an annual production is 5000 units.
2. If the direct material cost of a BluStandard player is $67.50 per unit, what is the total unit cost of the product?
3. Explain the treatment of the costs of the activity 'Design player'?
Step by Step Answer:
Management Accounting
ISBN: 9781760421144
7th Edition
Authors: Kim Langfield Smith, Helen Thorne, David Alan Smith, Ronald W. Hilton