Question: Gem Systems Gem Systems uses an activity-based costing system. The company has gathered the following information concerning various cost pools and activity drivers; Activity cost
Gem Systems
Gem Systems uses an activity-based costing system. The company has gathered the following information concerning various cost pools and activity drivers;
| Activity cost pool | Normal Cost | Activity cost driver | Activity level |
| Material Handling | $25,000 | Number of moves | 5,000 |
| Machine setups | $35,000 | Number of setups | 10,000 |
| Inspections | $ 5,000 | Number of Inspections | 2,500 |
| Electricity Costs | $15,000 | Kilowatt Hours | 5,000 |
The following data was collected and is specific to Job 150.
| Direct Material Cost | $40,000 |
| Direct Labor Cost | 25,000 (@ $10 per hour) |
| Number of machine setups | 3,000 |
| Number of material moves | 1,000 |
| Number of inspections | 100 |
| Kilowatt hours of electricity used | 1,000 |
| Units produced | 5,000 |
____ 12. Refer to Gem Systems. Calculate the unit cost for the Electricity Costs activity cost pool.
| a. | $15.00 |
| b. | $ 3.50 |
| c. | $ 3.00 |
| d. | $ 5.00 |
____ 13. Refer to Gem Systems. What is the amount of electricity cost allocated to Job 150?
| a. | $ 1,000 |
| b. | $15,000 |
| c. | $ 3,000 |
| d. | $ 5,000 |
____ 14. Refer to Gem Systems. What is the amount of machine handling cost allocated to Job 150?
| a. | $ 1,000 |
| b. | $ 5,000 |
| c. | $25,000 |
| d. | None of the above |
____ 15. Refer to Gem Systems. Calculate the unit cost for the Material Handling activity cost pool.
| a. | $5.00 |
| b. | $25.00 |
| c. | $10.00 |
| d. | $ 3.50 |
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