The following cost data is known about ABC Company Total Original $50 Deluxe $75 1 Direct...

 

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The following cost data is known about ABC Company Total Original $50 Deluxe $75 1 Direct Materials Direct Labour ($10 2 per hour) 20 30 Number of units 3 produced 7,000 units 2,000 units The CFO wishes to explore an activity-based costing system Activity (Cost Driver) Estimated МОН Expected Activity Total Standard Deluxe Assembly (Labour Hours) Receiving (Receiving Reports)- Testing (Number of $100,000 20,000 14,000 6,000 200,000 4,000 2,000 2,000 300.000 1,000 200 800 $600.000 Required a) Under the tradtional coshing method i Compute the predetermined overhead rate ANSWER Determine the unit cost of each product bJ Under activity based costing Compute the activity rates for each activity Determine the expected unit cost of each product c) Compare and comment on your answers from parts a and b) above d] If ABC produces more accur ate cost data, why is it not more widely used? The following cost data is known about ABC Company Total Original $50 Deluxe $75 1 Direct Materials Direct Labour ($10 2 per hour) 20 30 Number of units 3 produced 7,000 units 2,000 units The CFO wishes to explore an activity-based costing system Activity (Cost Driver) Estimated МОН Expected Activity Total Standard Deluxe Assembly (Labour Hours) Receiving (Receiving Reports)- Testing (Number of $100,000 20,000 14,000 6,000 200,000 4,000 2,000 2,000 300.000 1,000 200 800 $600.000 Required a) Under the tradtional coshing method i Compute the predetermined overhead rate ANSWER Determine the unit cost of each product bJ Under activity based costing Compute the activity rates for each activity Determine the expected unit cost of each product c) Compare and comment on your answers from parts a and b) above d] If ABC produces more accur ate cost data, why is it not more widely used?

Answer rating: 100% (QA)

Answer a 1Computation of predetermined overhead rate as per traditional method Predetermined overhead rate as per traditional method Total estimated MOH Total direct labour hours Predetermined overhea... View the full answer