Majestic Toys makes three different types of stuffed animals for various arcades across the country. The information on the work done on the factory’s machines is contained in the following table.

REQUIRED:

a. Using the total time used to make products, calculate what percentage of the productive time the machine is used to make each product.

b. Cost out the three products using their respective percentage of the total productive time.

c. Now put the costs for running the machines into one of the two cost pools, managed or committed capacity.

d. Calculate the cost per managed hour, per committed hour, and per total cost staffed hour.

e. Calculate the competitive cost of the three products using the staffed hourly rate you calculated in (d).

f. Explain as precisely as possible the differences in the estimated costs of the products.

Transcribed Image Text:

Majestic Toys Cost Information about the Machine Depreciation $50,000.00 People S100,000.00 Supplies $25,000.00 Maintenance $75,000.00 Electricity $20,000.00