3-403
3-404
74.
Diemer, Inc., manufactures and sells two products: Product N4 and Product R7. 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
Total Direct Labor-
Hours
Product N4
200
1,800
Product R7
900
7,200
Total direct labor-
hours
9,000
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 N4
Product R7
Total
Labor-related
DLHs
$357,120
1,800
7,200
9,000
Production orders
orders
20,797
400
300
700
General factory
MHs
358,425
3,800
3,700
7,500
$736,342
If the company allocates all of its overhead based on direct labor-hours using its
traditional costing method, the predetermined overhead rate would be closest to:
3-405
3-406
75.
Abbe, Inc., manufactures and sells two products: Product O9 and Product A3. 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
Total Direct Labor-
Hours
Product O9
1,000
8,000
Product A3
700
3,500
Total direct labor-
hours
11,500
The direct labor rate is $24.40 per DLH. The direct materials cost per unit for each
product is given below:
Direct Materials Cost per Unit
Product O9
$192.40
Product A3
$246.60
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 O9
Product A3
Total
Labor-related
DLHs
$534,980
8,000
3,500
11,500
Machine setups
setups
17,649
400
500
900
General factory
MHs
221,715
3,100
3,400
6,500
$774,344
The unit product cost of Product O9 under the company’s traditional costing method in
3-407
which all overhead is allocated on the basis of direct labor-hours is closest to:
3-408
76.
Sylvest, Inc., manufactures and sells two products: Product O3 and Product L8. 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 O3
1,000
9.0
9,000
Product L8
1,000
6.0
6,000
Total direct labor-
hours
15,000
The company’s expected total manufacturing overhead is $913,376.
If the company allocates all of its overhead based on direct labor-hours, the overhead
assigned to each unit of Product O3 would be closest to:
3-409
3-410
77.
Cassano, Inc., manufactures and sells two products: Product C8 and Product E6. 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 C8
800
6.0
4,800
Product E6
600
9.0
5,400
Total direct labor-
hours
10,200
The direct labor rate is $19.80 per DLH. The direct materials cost per unit is $145.10 for
Product C8 and $181.00 for Product E6. The estimated total manufacturing overhead is
$671,598.
The unit product cost of Product C8 under the company’s traditional costing method in
which all overhead is allocated on the basis of direct labor-hours is closest to:
3-411
3-412
78.
Boahn, Inc., manufactures and sells two products: Product B6 and Product W8. 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 B6
200
7.0
1,400
Product W8
100
9.0
900
Total direct labor-
hours
2,300
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 B6
Product W8
Total
Labor-related
DLHs
$91,149
1,400
900
2,300
Machine setups
setups
54,549
500
400
900
General factory
MHs
329,550
3,200
3,300
6,500
$475,248
If the company allocates all of its overhead based on direct labor-hours using its
traditional costing method, the overhead assigned to each unit of Product W8 would be
closest to:
3-413
3-414
79.
Avella, Inc., manufactures and sells two products: Product C2 and Product T1. 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
Total Direct Labor-
Hours
Product C2
100
500
Product T1
800
4,800
Total direct labor-
hours
5,300
The company’s expected total manufacturing overhead is $775,080.
If the company allocates all of its overhead based on direct labor-hours, the overhead
assigned to each unit of Product T1 would be closest to:
3-415
80.
Schoeninger, Inc., manufactures and sells two products: Product X1 and Product I6. 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
X1
Product
I6
Total
Labor-related
DLHs
$293,231
700
9,000
9,700
Machine setups
setups
74,767
600
500
1,100
General factory
MHs
268,830
4,300
4,400
8,700
$636,828
The activity rate for the Labor-Related activity cost pool under activity-based costing is
closest to:
3-416
81.
Schoeninger, Inc., manufactures and sells two products: Product X1 and Product I6. 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
X1
Product
I6
Total
Labor-related
DLHs
$293,231
700
9,000
9,700
Machine setups
setups
74,767
600
500
1,100
General factory
MHs
268,830
4,300
4,400
8,700
$636,828
The activity rate for the Machine Setups activity cost pool under activity-based costing is
closest to:
3-417
82.
Schoeninger, Inc., manufactures and sells two products: Product X1 and Product I6. 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
X1
Product
I6
Total
Labor-related
DLHs
$293,231
700
9,000
9,700
Machine setups
setups
74,767
600
500
1,100
General factory
MHs
268,830
4,300
4,400
8,700
$636,828
The activity rate for the General Factory activity cost pool under activity-based costing is
closest to:
3-418
83.
Bolerjack, Inc., manufactures and sells two products: Product G9 and Product B6. 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 G9
100
6.0
600
Product B6
500
9.0
4,500
Total direct labor-
hours
5,100
The direct labor rate is $16.50 per DLH. The direct materials cost per unit is $204.30 for
Product G9 and $284.50 for Product B6
.
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
G9
Product
B6
Total
Labor-related
DLHs
$181,305
600
4,500
5,100
Production orders
orders
79,196
600
700
1,300
General factory
MHs
580,964
3,200
2,900
6,100
$841,465
The unit product cost of Product G9 under activity-based costing is closest to:
3-419
3-420
3-421
84.
Bolerjack, Inc., manufactures and sells two products: Product G9 and Product B6. 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 G9
100
6.0
600
Product B6
500
9.0
4,500
Total direct labor-
hours
5,100
The direct labor rate is $16.50 per DLH. The direct materials cost per unit is $204.30 for
Product G9 and $284.50 for Product B6
.
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 G9
Product B6
Total
Labor-related
DLHs
$181,305
600
4,500
5,100
Production orders
orders
79,196
600
700
1,300
General factory
MHs
580,964
3,200
2,900
6,100
$841,465
The unit product cost of Product B6 under activity-based costing is closest to:
3-422