Question: Help Please I don't know how to solve this problem !! This question is about Activity Based Costing. The Peggy Playground produces children's swing-sets. Produce

Help Please I don't know how to solve this problem !!

This question is about Activity Based Costing.

The Peggy Playground produces children's swing-sets.

  • Produce swing-sets 4,500
  • machine hours require 1,500 and also required four "set-ups" of equipment.
  • the final inspection required 75 hours of inspection activity
  • estimated overhead $25 per machine hr,
  • Set up (per set up) $3,500
  • Inspection $20 hr inspection
  • Direct materials-direct labor total $500 per swing-set.

a)determine the amount assigned to a swing-set?

b)and For GAAP, Peggy Playground applies traditional costing methods, and allocates overhead at $40 per machine hour. How much cost would be assigned to the 4,500 swing-sets?-

What is the per unit cost of a swing-set under the traditional approach?

What might explain the higher cost assignment, and how could this influence business decision making?

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