Determine the product margin for the OfficeMart orders under a traditional cost system Manufacturing overhead $500,000...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Determine the product margin for the OfficeMart orders under a traditional cost system Manufacturing overhead $500,000 Total activity Manufacturing overhead per unit Sales Costs: Direct materials Direct labor Manufacturing overhead Traditional costing product margin $ 1,000 units 500 per unit $ 47,600 $ 14,400 4,000 40.000 58,400 $(10,800) Note that the worksheet contains a section at the bottom titled "Determine the Product Margin Under a Traditional Cost System" that is not in the Review Problem. In this section, it is assumed that the traditional costing system allocates manufacturing overhead on the basis of the number of units produced. When completed, that part of the worksheet should contain the following results: After entering formulas in all of the cells that contained question marks, verify that the dollar amounts match the numbers in the Review Problem. Check your worksheet by doubling the units ordered in cell B16 to 160. The customer margin under activity-based costing should now be $7,640 and the traditional costing product margin should be $(21,600). If you do not get these results, find the errors in your worksheet and correct them. A 1 Chapter 5: Applying Excel 2 3 Data 4 Manufacturing overhead 5 Selling and administrative overhead 6 8 Manufacturing overhead 9 Selling and administrative overhead 10 Total activity 11 12 13 OfficeMart orders: 14 Customers 25 26 Manufacturing overhead 27 Selling and administrative overhead 28 Total cost 29 30 Compute the activity rates 31 Activity Cost Pools 32 Assembling units 33 Processing orders 34 Supporting customers 35 B $500,000 $300,000 37 Activity Cost Pools 38 Assembling units 39 Processing orders 40 Supporting customers 41 50% 10% 1,000 15 Orders 16 Number of filing cabinets ordered in total 17 Selling price 18 Direct materials 19 Direct labor 20 21 Enter a formula into each of the cells marked with a ? below 22 Review Problem: Activity-Based Costing 23 24 Perform the first stage allocations Assembling Processing Supporting Units Orders Customers units 1 customer 4 orders 80 units $595 $180 $50 с ? ? ? Assembling Processing Units Orders Total Cost 35% 45% 250 orders ? ? ? ? D 36 Compute the overhead cost attributable to the OfficeMart orders Activity Rate ? per unit ? per order ? per customer 5% 25% 100 customers Supporting Customers ? ? ? Total Activity ? units ? orders ? customers E Other Activity ? units 10% 20% Other ? ? ? F ? orders ? customer Total ? ? ? Activity Rate ? per unit ? per order ? per customer ABC Cost ? ? ? C 23 24 Perform the first stage allocations 25 26 Manufacturing overhead 27 Selling and administrative overhead 28 Total cost 29 30 Compute the activity rates 31 Activity Cost Pools 45 Direct materials Direct labor 46 47 48 32 Assembling units 33 Processing orders 34 Supporting customers 35 36 Compute the overhead cost attributable to the OfficeMart orders 37 Activity Cost Pools Activity Rate ? per unit 38 Assembling units 39 Processing orders 40 Supporting customers 41 Unit-related overhead Order-related overhead Assembling Processing Supporting Units Orders Customers 55 Manufacturing overhead per unit 56 57 Sales 58 Costs: ? ? ? 59 Direct materials Direct labor Total Cost 60 61 Manufacturing overhead 62 Traditional costing product margin 63 ? ? 42 Determine the customer margin for the OfficeMart orders under Activity-Based Costing 43 Sales ? 44 Costs: ? per order ? per customer ? ? ? ? ? ? ? ? Total Activity ? units ? orders ? customers ? ? units ? per unit ? ? ? 49 Customer-related overhead 50 Customer margin 51 52 Determine the product margin for the OfficeMart orders under a traditional cost system 53 Manufacturing overhead 54 Total activity ? ? ? ? ? ? ? Other ? Activity ? units ? ? ? ? orders ? customer Total ? ? ? Activity Rate ? per unit ? per order ? per customer ABC Cost ? ? ? Determine the product margin for the OfficeMart orders under a traditional cost system Manufacturing overhead $500,000 Total activity Manufacturing overhead per unit Sales Costs: Direct materials Direct labor Manufacturing overhead Traditional costing product margin $ 1,000 units 500 per unit $ 47,600 $ 14,400 4,000 40.000 58,400 $(10,800) Note that the worksheet contains a section at the bottom titled "Determine the Product Margin Under a Traditional Cost System" that is not in the Review Problem. In this section, it is assumed that the traditional costing system allocates manufacturing overhead on the basis of the number of units produced. When completed, that part of the worksheet should contain the following results: After entering formulas in all of the cells that contained question marks, verify that the dollar amounts match the numbers in the Review Problem. Check your worksheet by doubling the units ordered in cell B16 to 160. The customer margin under activity-based costing should now be $7,640 and the traditional costing product margin should be $(21,600). If you do not get these results, find the errors in your worksheet and correct them. A 1 Chapter 5: Applying Excel 2 3 Data 4 Manufacturing overhead 5 Selling and administrative overhead 6 8 Manufacturing overhead 9 Selling and administrative overhead 10 Total activity 11 12 13 OfficeMart orders: 14 Customers 25 26 Manufacturing overhead 27 Selling and administrative overhead 28 Total cost 29 30 Compute the activity rates 31 Activity Cost Pools 32 Assembling units 33 Processing orders 34 Supporting customers 35 B $500,000 $300,000 37 Activity Cost Pools 38 Assembling units 39 Processing orders 40 Supporting customers 41 50% 10% 1,000 15 Orders 16 Number of filing cabinets ordered in total 17 Selling price 18 Direct materials 19 Direct labor 20 21 Enter a formula into each of the cells marked with a ? below 22 Review Problem: Activity-Based Costing 23 24 Perform the first stage allocations Assembling Processing Supporting Units Orders Customers units 1 customer 4 orders 80 units $595 $180 $50 с ? ? ? Assembling Processing Units Orders Total Cost 35% 45% 250 orders ? ? ? ? D 36 Compute the overhead cost attributable to the OfficeMart orders Activity Rate ? per unit ? per order ? per customer 5% 25% 100 customers Supporting Customers ? ? ? Total Activity ? units ? orders ? customers E Other Activity ? units 10% 20% Other ? ? ? F ? orders ? customer Total ? ? ? Activity Rate ? per unit ? per order ? per customer ABC Cost ? ? ? C 23 24 Perform the first stage allocations 25 26 Manufacturing overhead 27 Selling and administrative overhead 28 Total cost 29 30 Compute the activity rates 31 Activity Cost Pools 45 Direct materials Direct labor 46 47 48 32 Assembling units 33 Processing orders 34 Supporting customers 35 36 Compute the overhead cost attributable to the OfficeMart orders 37 Activity Cost Pools Activity Rate ? per unit 38 Assembling units 39 Processing orders 40 Supporting customers 41 Unit-related overhead Order-related overhead Assembling Processing Supporting Units Orders Customers 55 Manufacturing overhead per unit 56 57 Sales 58 Costs: ? ? ? 59 Direct materials Direct labor Total Cost 60 61 Manufacturing overhead 62 Traditional costing product margin 63 ? ? 42 Determine the customer margin for the OfficeMart orders under Activity-Based Costing 43 Sales ? 44 Costs: ? per order ? per customer ? ? ? ? ? ? ? ? Total Activity ? units ? orders ? customers ? ? units ? per unit ? ? ? 49 Customer-related overhead 50 Customer margin 51 52 Determine the product margin for the OfficeMart orders under a traditional cost system 53 Manufacturing overhead 54 Total activity ? ? ? ? ? ? ? Other ? Activity ? units ? ? ? ? orders ? customer Total ? ? ? Activity Rate ? per unit ? per order ? per customer ABC Cost ? ? ?
Expert Answer:
Related Book For
Managerial Accounting for Managers
ISBN: 978-1259578540
4th edition
Authors: Eric Noreen, Peter Brewer, Ray Garrison
Posted Date:
Students also viewed these accounting questions
-
The Excel worksheet form that follows is to be used to recreate the Review Problem relating to Ferris Corporation that was presented earlier. Download the workbook containing this form from Connect....
-
The Excel worksheet form that appears below is to be used to recreate the Review Problem pertaining to Ferris Corporation. Download the workbook containing this form from Connect, where you will also...
-
The Hampshire Company manufactures umbrellas that sell for $12.50 each. In 2014, the company made and sold 60,000 umbrellas. The company had fixed manufacturing costs of $216,000. It also had fixed...
-
Given a sorted array of Comparable items, write functions floor () and ceiling () that return the index of the largest (or smallest) item not larger (or smaller) than an argument item in logarithmic...
-
Which one of the following statements regarding pro-forma financial statements is false? a. Pro-forma financial statements include an income statement, a balance sheet, and a statement of cash flows....
-
Dunbar Corporation can purchase an asset for $30,000; the asset will be worthless after 14 years. Alternatively, it could lease the asset for 14 years with an annual lease payment of $3,653 paid at...
-
Explain why the addition of the quantifiers and makes predicate calculus so powerful.
-
Multiple Choice Questions, 1. After massive promotion of Justin Bieber's latest music album, the producers reacted by raising prices for his albums. This implies that promotion expenditures made the...
-
Dorpac Corporation has a dividend yield of 1.3%. Its equity cost of capital is 8.8%, and its dividends are expected to grow at a constant rate. a. What is the expected growth rate of Dorpac's...
-
Angela Green, an investment manager at Horizon Investments, intends to hire a new investment analyst. After conducting initial interviews, Green has narrowed the pool to three candidates. She plans...
-
How does synergistic cooperation manifest in intricate interdisciplinary projects requiring specialized expertise ? Explain
-
Task C has two immediate predecessors, tasks A and B. Task A has an early finish time of 3 days, and task B has an early finish time of 5 days. What is the early start time of task C?
-
A certain office building must be renovated and then sold. Renovation of similar buildings has taken an average of 4 weeks, with a standard deviation of 1 week. Once placed on the market after...
-
Path A-B-E has a 55% probability of being completed within 3 weeks. Path C-D-F has a 90% probability of being completed within 3 weeks. If these are the only two paths in a project network, what is...
-
Why is the organization's structure important in how the supply chain management function operates?
-
A project network has two paths running through it. The first path has an expected length of 10 days and a variance of 2 days. The second path has an expected length of 11 days and a variance of 1...
-
Henri Fayol claims that managers in their everyday routine, perform our five major functions. Provide a detailed evaluation of Fayols five general management functions which managers in modern...
-
Explain briefly what is meant by electronic data interchange (EDI). How does EDI affect a companys audit trail?
-
Hi-Tek Manufacturing Inc. makes two types of industrial component parts-the B300 and the T500. An absorption costing income statement for the most recent period is shown below: Hi-Tek Manufacturing...
-
Techuxia Corporation worked on four jobs during October: Job A256, Job A257, Job A258, and Job A260. At the end of October, the job cost sheets for these jobs contained the following data: Jobs A256...
-
Bracey Company manufactures and sells one product. The following information pertains to the company's first year of operations: Variable cost per unit: Direct materials...
-
With your instructor's consent, identify a company and perform a background review of it to identify high-risk areas for an upcoming audit. Utilize all the electronic sources that have information...
-
CPA firms performing management consulting services can accept contingent fee contracts when: a. The amounts are not material in relationship to the audit billings. b. The consulting services are for...
-
Applying utilitarianism as a concept in addressing ethical situations requires the auditor to perform all of the following except: a. Identify the potential stakeholders that will be affected by the...
Study smarter with the SolutionInn App