For the next year 20X5, Toa Baja Company has identified the following costs, indirect manufacturing costs (IMC) by activities and cost drivers and is expected to operate at maximum capacity:

Actividad	IMC	Driver	Capacity
Mixing of ingredients	$  900,000	# of ingredients mixed	6,000 blended ingredients
Product molding	$  480,000	# of molded products	48,000 molded products
Machine configuration	$  330,000	# machine hours	30,000 HM
Finishing	$ 350,000	# of direct labor hours	50,000 HLD

 

The following two (2) orders were completed during 20X5: 

	Orden TC-43200	Orden TB-43160
Total cost - direct material	$18,400	$32,600
Total cost - direct labor	$16,000	$23,500
# of ingredients mixed	30	20
# of products molded	40	30
Machine hours	100	400
# of direct labor hours	200	300

 

Determine the cost of each order, assuming that the company uses the traditional system (single application rate) in the application of CIMs and is based on direct labor hours to apply the CIMs.

Answer rating: 100% (QA)

To determine the cost of each order using the traditional system single application rate based on di... View the full answer