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194. Yarn, Inc., manufactures and sells two products: Product Z9 and Product G9. Data
concerning the expected production of each product and the expected total direct labor-hours
(DLHs) required to produce that output appear below:
Expected Production Direct Labor-Hours Per Unit
Total Direct Labor-Hours
Product Z9 600 8.0 4,800
Product G9 900 6.0 5,400
Total direct labor-hours 10,200
The direct labor rate is $19.40 per DLH. The direct materials cost per unit is $268.80 for Product
Z9 and $250.00 for Product G9
.
The company has an activity-based costing system with the following activity cost pools, activity
measures, and expected activity:
Estimated Expected Activity
Activity Cost Pools Activity Measures Overhead Cost Product Z9
Product G9 Total
Labor-related DLHs $264,690 4,800 5,400 10,200
Production orders Orders 33,100 300 200 500
General factory MHs 802,288 4,200 4,000 8,200
$1,100,078
Required:
Determine the unit product cost of each product under the activity-based costing method.
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195. Jaure, Inc., manufactures and sells two products: Product H4 and Product I3. Data
concerning the expected production of each product and the expected total direct labor-hours
(DLHs) required to produce that output appear below:
Expected Production Direct Labor-Hours Per Unit
Total Direct Labor-Hours
Product H4 100 5.0 500
Product I3 500 2.0 1,000
Total direct labor-hours 1,500
The direct labor rate is $29.40 per DLH. The direct materials cost per unit is $244.70 for Product
H4 and $206.20 for Product I3
.
The company has an activity-based costing system with the following activity cost pools, activity
measures, and expected activity:
Estimated Expected Activity
Activity Cost Pools Activity Measures Overhead Cost Product H4
Product I3
Total
Labor-related DLHs $41,700 500 1,000 1,500
Production orders Orders 67,131 500 400 900
General factory MHs 588,098 5,000 4,800 9,800
$696,929
Required:
a. Compute the activity rates under the activity-based costing system.
b. Determine how much overhead would be assigned to each product under the activity-based
costing system.
c. Determine the unit product cost of each product under the activity-based costing method.
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196. Moul, Inc., manufactures and sells two products: Product Y8 and Product Z9. Data
concerning the expected production of each product and the expected total direct labor-hours
(DLHs) required to produce that output appear below:
Expected Production Direct Labor-Hours Per Unit
Total Direct Labor-Hours
Product Y8 700 7.0 4,900
Product Z9 100 4.0 400
Total direct labor-hours 5,300
The direct labor rate is $18.80 per DLH. The direct materials cost per unit is $116.30 for Product
Y8 and $187.40 for Product Z9.
The company has an activity-based costing system with the following activity cost pools, activity
measures, and expected activity:
Estimated Expected Activity
Activity Cost Pools Activity Measures Overhead Cost Product Y8
Product Z9
Total
Labor-related DLHs $81,779 4,900 400 5,300
Product testing Tests 100,572 500 700 1,200
General factory MHs 315,117 5,000 4,900 9,900
$497,468
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Required:
In all computations involving dollars in the following requirements, round off your answer to the
nearest whole cent.
a. Compute the activity rates under the activity-based costing system.
b. Determine how much overhead would be assigned to each product under the activity-based
costing system.
c. Determine the unit product cost of each product under the activity–based costing method.
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197. Shadow, Inc., manufactures and sells two products: Product X9 and Product L1. Data
concerning the expected production of each product and the expected total direct labor-hours
(DLHs) required to produce that output appear below:
Expected Production Direct Labor-Hours Per Unit
Total Direct Labor-Hours
Product X9 500 5.0 2,500
Product L1 700 2.0 1,400
Total direct labor-hours 3,900
The direct labor rate is $21.20 per DLH. The direct materials cost per unit for each product is
given below:
Direct Materials Cost per Unit
Product X9 $171.20
Product L1 $299.80
The company is considering adopting an activity-based costing system with the following activity
cost pools, activity measures, and expected activity:
Estimated Expected Activity
Activity Cost Pools Activity Measures Overhead Cost Product X9
Product L1 Total
Labor-related DLHs $139,581 2,500 1,400 3,900
Machine setups Setups 37,642 500 600 1,100
General factory MHs 560,829 3,600 3,500 7,100
$738,052
Required:
Determine the unit product cost of each product under the activity-based costing method.
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198. Dace Company manufactures two products, Product F and Product G. The company
expects to produce and sell 3,200 units of Product F and 2,100 units of Product G during the
current year. Data relating to the company’s three activity cost pools are given below for the
current year:
Estimated Expected Activity
Activity Cost Pool Overhead Cost
Product F
Product G
Total
Machine setups $7,020 130 setups 130 setups 260 setups
Purchase orders $69,700 520 orders 1,180 orders 1,700 orders
General factory $101,160 3,520 hours 2,100 hours 5,620 hours
Required:
Using the activity-based costing approach, determine the overhead cost per unit for each
product.
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199. Luckado, Inc., manufactures and sells two products: Product O5 and Product F4. Data
concerning the expected production of each product and the expected total direct labor-hours
(DLHs) required to produce that output appear below:
Expected Production Direct Labor-Hours Per Unit
Total Direct Labor-Hours
Product O5 500 9.0 4,500
Product F4 800 7.0 5,600
Total direct labor-hours 10,100
The direct labor rate is $18.10 per DLH. The direct materials cost per unit is $164.00 for Product
O5 and $139.80 for Product F4.
The company has an activity-based costing system with the following activity cost pools, activity
measures, and expected activity:
Estimated Expected Activity
Activity Cost Pools Activity Measures Overhead Cost Product O5
Product F4
Total
Labor-related DLHs $113,322 4,500 5,600 10,100
Machine setups Setups 63,558 600 500 1,100
General factory MHs 502,227 4,800 5,100 9,900
$679,107
Required:
Determine the unit product cost of each product under the activity-based costing method.
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