XYZ Company has three types of product departments (Chocolate (Vanilla), Chocolate (Almond), and Chocolate (Caramel)) with...

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XYZ Company has three types of product departments (Chocolate (Vanilla), Chocolate (Almond), and Chocolate (Caramel)) with the following information: Chocolate (Vanilla) Chocolate (Almond) Chocolate (Caramel) Total Number of advertisements 40 70 150 Number of Customer Orders 1400 40 800 60,000 1300 3,500 Number of km driven 90,000 30,000 180,000 The business also has overhead costs as follows: Activity Costs per activity AED Cost driver Maintenance vehicle AED 38,000,000 Number of km driven Admin cost customer orders AED 420,200 Number of customers orders Number of advertisements Advertising AED 610,000 A. Determine the cost of each of the company's segments under the traditional costing system in which it applies total manufacturing overhead of AED 37,213,200.00 using a predetermined overhead rate based on number of customer orders. (5 Marks) B. If the company considering using a variation of activity-based costing to determine its segments costs for external reports. Determine the cost of each of the company's three segments under activity-based costing system. (15 Marks) XYZ Company has three types of product departments (Chocolate (Vanilla), Chocolate (Almond), and Chocolate (Caramel)) with the following information: Chocolate (Vanilla) Chocolate (Almond) Chocolate (Caramel) Total Number of advertisements 40 70 150 Number of Customer Orders 1400 40 800 60,000 1300 3,500 Number of km driven 90,000 30,000 180,000 The business also has overhead costs as follows: Activity Costs per activity AED Cost driver Maintenance vehicle AED 38,000,000 Number of km driven Admin cost customer orders AED 420,200 Number of customers orders Number of advertisements Advertising AED 610,000 A. Determine the cost of each of the company's segments under the traditional costing system in which it applies total manufacturing overhead of AED 37,213,200.00 using a predetermined overhead rate based on number of customer orders. (5 Marks) B. If the company considering using a variation of activity-based costing to determine its segments costs for external reports. Determine the cost of each of the company's three segments under activity-based costing system. (15 Marks)

Answer rating: 100% (QA)

A Overhead cost allocation as per Traditional based costing Statement showing Overhead cost allocate... View the full answer