F Question 2 Quebec Plc operates an activity based costing system and forecasts the following activity...

 

Transcribed Image Text:

F Question 2 Quebec Plc operates an activity based costing system and forecasts the following activity for the next financial year detailed in Table1 - Cost Data: Cost Pool Table1 Cost Data www Cost Driver 140,500 Set-ups 196,000 Tests Cost £ Machine set-ups Quality testing Component 36,000 supply Packing & 135,000 delivery Component orders Customer orders Occurrence 500 1,400 600 1,800 2 ● Additional information General fixed overheads which cannot be linked to any specific activity are expected to be £450,000 and are to be absorbed using direct labour hours. Total labour hours for the next year are expected to be 150,000 hours. The company expects orders for one of their products, Sierra, next year to be 200 orders of 50 units per order and 140 orders of 20 units per order. The company produce the order requirements in production runs of 400 units. One order for components is placed prior to each production run. Three quality tests are made during each production run. Component costs - £1.90 per unit. The company produce the order requirements in production runs of 400 units. One order for components is placed prior to each production run. Three quality tests are made during each production run. Component costs - £1.90 per unit. Direct labour-0.5 hr per unit at £10.80 per hour. [Total 25 marks] 20 points 2(a) Calculate the total unit cost for Sierra using activity based costing (ABC). Present your answer appropriately and round answers to 2 decimal places. F Question 2 Quebec Plc operates an activity based costing system and forecasts the following activity for the next financial year detailed in Table1 - Cost Data: Cost Pool Table1 Cost Data www Cost Driver 140,500 Set-ups 196,000 Tests Cost £ Machine set-ups Quality testing Component 36,000 supply Packing & 135,000 delivery Component orders Customer orders Occurrence 500 1,400 600 1,800 2 ● Additional information General fixed overheads which cannot be linked to any specific activity are expected to be £450,000 and are to be absorbed using direct labour hours. Total labour hours for the next year are expected to be 150,000 hours. The company expects orders for one of their products, Sierra, next year to be 200 orders of 50 units per order and 140 orders of 20 units per order. The company produce the order requirements in production runs of 400 units. One order for components is placed prior to each production run. Three quality tests are made during each production run. Component costs - £1.90 per unit. The company produce the order requirements in production runs of 400 units. One order for components is placed prior to each production run. Three quality tests are made during each production run. Component costs - £1.90 per unit. Direct labour-0.5 hr per unit at £10.80 per hour. [Total 25 marks] 20 points 2(a) Calculate the total unit cost for Sierra using activity based costing (ABC). Present your answer appropriately and round answers to 2 decimal places.

Answer rating: 100% (QA)

OVERHEAD RATE USING ACTIVITY BASED COSTING PRINCIPLE ALLOCATED COSTS A B CAB Activity Activity Cos... View the full answer