Multiple choice
1 . McCaskey Corporation used an activity-based costing system with the following three activity cost pools:
|
Activity cost pool |
Total activity |
|
|
Fabrication |
40,000 |
Machine hours |
|
Order processing |
500 |
Others |
|
Other |
N/A |
|
The other activity cost pool is used to accumulate cost of idle capacity and organization- sustaining cost.
The has providing the following data concerning it cost:
|
Wages and Salaries |
$469,000 |
|
Depreciation |
$191,000 |
|
Occupancy |
$120,000 |
|
Total |
$780,000 |
The distribution of resource consumption across activity cost pool is given below:
|
|
Activity cost pools |
|
||
|
|
Fabrication |
Order processing |
Other |
Total |
|
Wages and Salaries |
20% |
60% |
20% |
100% |
|
Depreciation |
20% |
25% |
55% |
100% |
|
Occupancy |
20% |
45% |
35% |
100% |
The activity rate for the fabrication activity cost pool is closed to:
a. $0.65 per machine- hour
b. $3.90 per machine-hour
c. $4.88 per machine- hour
d. 2.25 per machine-hour
2. Spendlove corporation has provided the following data from its activity-based costing system
|
Activity cost pool |
Total cost |
Total activity |
|
|
Assembly |
$1,282,140 |
61,200 |
Machine- hours |
|
Processing orders |
$53,958.00 |
20,40 |
Orders |
|
Inspection |
$181,350 |
23,40 |
Inspection- hour |
The company makes 1,100 units of product S78N a year, requiring a total of 12,00 machine hours, 131 orders, and 31 inspection-hour per year. The product’s direct material cost is $50,89 per units and its direct labor cost is $20.56 per unit. The product sells of $113.30 per unit.
According to the activity-based costing system, the product margin for product S78N is : (Round your intermediate calculation to 2 decimal place).
a. $117,430.05
b. $46,035.00
c. $18,492.05
d. $15,027.55
3.Matt Company used activity- based costing. The company has two product. A and B. the annual production and sales of product A is 9,000 units and of product B is 6,500 units. There are three activity cost pool with total activity as follow:
|
|
|
Total Activity |
||
|
Activity Cost Pool |
Total Cost |
Product A |
Product B |
Total |
|
Activity 1 |
$36,260 |
250 |
350 |
700 |
|
Activity 2 |
$48,037 |
880 |
330 |
1,210 |
|
Activity 3 |
$120,450 |
850 |
3,530 |
4,380 |
The activity based costing cost per unit of product Ais closest to:
a. $14.33
b. $4.54
c. $7.84
d. $3.94
4. The controller Ferrence Company estimates the amount of material handing overhead cost that should be allocated to the company’s two product using the data that are given below:
|
|
Wall Mirrors |
Specialty Windows |
|
Total Expected Units Produced |
11,900 |
1,710 |
|
Total Expected Material Moves |
1,190 |
1,610 |
|
Expected Direct Labor- Hour Per Unit |
7 |
8 |
The total material handing cost for the year is expected to be $17,148.70.
If the material handing cost is allocated on the basis of direct labor- hours, how much of the total material handing cost would e allocated to the wall mirrors?
a. $9,566
b. $14,727
c. $12,894
d. $7,917
