= Test: Exam 2 This test: 100 point(s) possible This question: 2 point(s) possible Submit test Orange Test Laboratories does heat testing (HT) and stress testing (ST) on materials and operates at capacity. Under its current simple costing system, Orange aggregates all operating costs of $1,360,000 into a Requirement 1. Classify each activity cost as output unit-level, batch-level, product- or service-sustaining, or facility-sustaining. Explain each answer. Cost Item Cost-type a. Direct labor b. Equipment-related costs (rent, maintenance, energy, etc.) c. Setup costs d. Costs of designing tests O Output unit-level costs are Batch-level costs are Service-sustaining costs are Facility-sustaining costs are Requirement 2. Calculate the cost per test-hour for HT and ST. Explain briefly the reasons why these numbers differ from the $16 per test-hour that Orange calculated using its simple costing system. O First, determine the formula used to calculate the cost for each activity in each test type. NextE Test: Exam 2 Question 8 of 36 > This test: 100 point(s) possible This question: 2 point(s) possible Submit test (- Orange Test Laboratories does heat testing (HT) and stress testing (ST) on materials and operates at capacity. Under its current simple costing system, Orange aggregates all operating costs of $1,360,000 into a Requirement 2. Calculate the cost per test-hour for HT and ST. Explain briefly the reasons why these numbers differ from the $16 per test-hour that Orange calculated using its simple costing system. First, determine the formula used to calculate the cost for each activity in each test type. = Cost per activity Calculate the cost of each activity and the total cost of the heat testing and stress testing. Heat Test (HT) Stress Test (ST) Total Total O Cost Cost Direct labor Equipment Setup Design O Total NextE Test: Exam 2 This test: 100 point(s) possible This question: 2 point(s) possible Submit test Orange Test Laboratories does heat testing (HT) and stress testing (ST) on materials and operates at capacity. Under its current simple costing system, Orange aggregates all operating costs of $1,360,000 into a Total Determine the formula to calculate the HT cost per test-hour and enter the amounts to calculate the rate. (Round the rate to the nearest cent.) HT Cost per test-hour per test-hour Determine the formula to calculate the ST cost per test-hour and enter the amounts to calculate the rate. (Round the rate to the nearest cent.) ST Cost per test-hour per test-hour O The cost per test-hour for HT and ST differs from the cost per test-hour using the simple rate because: O Requirement 3. Explain the accuracy of the product costs calculated using the simple costing system and the ABC system. How might Orange's management use the cost hierarchy and ABC information to better manage its business? NextExam 2 - Personal - Microsoft Edge - X https://mylab.pearson.com/Student/PlayerTest.aspx?testld=243928810¢erwin=yes A ACCT 3110 Cost Accounting (82408) - Fall 2022 KRISTIN LINDSEY 10/13/22 9:11 PM ? E Test: Exam 2 Question 8 of 36 This test: 100 point(s) possible This question: 2 point(s) possible Submit test Orange Test Laboratories does heat testing (HT) and stress testing (ST) on materials and operates at capacity. Under its current simple costing system, Orange aggregates all operating costs of $1,360,000 into a per test-hour Determine the formula to calculate the ST cost per test-hour and enter the amounts to calculate the rate. (Round the rate to the nearest cent.) = ST Cost per test-hour per test-hour The cost per test-hour for HT and ST differs from the cost per test-hour using the simple rate because: Requirement 3. Explain the accuracy of the product costs calculated using the simple costing system and the ABC system. How might Orange's management use the cost hierarchy and ABC information to better manage its business? The accuracy of the product costs will be with the ABC system instead of the simple costing system. The ABC product costs will the utilization of resources by both products. O Management can use the ABC costs to . The cost hierarchy enables management to more accurately determine the cost drivers of costs. Next 68.F O 9:11 PM Clear 10/13/2022 2This test: 100 point(5) possible @ : Test: Exam 2 Question 3 of 36 ' This question: 2 minus) possible Submit test I9 Orange Test Laboratories does heat testing (HT ggregates all operating costs of$1.360.000 into a singie overhead cost pool Orange calculates a r st-hours Gary Mahoney. Orange's controller. believes that there is enough variation in test procedures Data table 'coming competitive Without this information. any miscosting and mispricing of its services could c. G) E (Click the icon to View the activity-cost categ Read the requirements. . Directelabor casts. $338.00!) These costs can be directiy traced to HT_ 8275.000. V i and ST. $53000 . Equipment-related casts (rent. maintenance. energy. and so an] 33:10 [100 These costs are allocated to HT and ST on the basis attestehours ' . . _ . Setup costs SBSTDDD These costs are allocated to HT and ST oh the basis ofthe Requirement1. Class\"? 93C\" 3'5\"\"? COST- 35 0 number of setuprhours required HT requires 13 [100 setuohours and ST requires 4.000 setuprhuurs Costs of designing tests 8233.500 These costs are allocated to HT and ST on the . Direct labor basis of the time required for designing the tests. HT requires 3.000 hours. and ST requires 1500 hours. Co st Item O . Equipment-related costs (rent. maintenance. c. Setup costs . Costs of designing tests ' t Output unit-Ievei costs are E O Batch-level costs are = Test: Exam 2