79. National Inc. manufactures two models of CMD that can be used as cell phones, MPX,
and digital camcorders.
Model Annual Sales in Units
High F 10,000
Great P 16,000
National uses a volume-based costing system to apply factory overhead based on direct labor
dollars. The unit prime costs of each product were as follows:
High F Great P
Direct materials $38.00 $25.40
Direct labor $17.52 $13.14
Budget factory overhead:
Engineering and Design 2,409 engineering hours $404,712
Quality Control 12,848 inspection hours 269,808
Machinery 33,726 machine hours 539,616
Miscellaneous Overhead 26,400 direct labor hours 134,904
Total $1,349,040
National’s controller had been researching activity-based costing and decided to switch to it. A
special study determined National’s two products have the following budgeted activities:
High F Great P
Engineering and design hours 969 1,440
Quality control inspection hours 5,648 7,200
Machine hours 20,286 13,440
Labor hours 12,000 14,400
Using activity-based costing, applied machinery overhead for the Great P model per unit is
(rounded to the nearest cent):
80. National Inc. manufactures two models of CMD that can be used as cell phones, MPX,
and digital camcorders.
Model Annual Sales in Units
High F 10,000
Great P 16,000
National uses a volume-based costing system to apply factory overhead based on direct labor
dollars. The unit prime costs of each product were as follows:
High F Great P
Direct materials $38.00 $25.40
Direct labor $17.52 $13.14
Budget factory overhead:
Engineering and Design 2,409 engineering hours $404,712
Quality Control 12,848 inspection hours 269,808
Machinery 33,726 machine hours 539,616
Miscellaneous Overhead 26,400 direct labor hours 134,904
Total $1,349,040
National’s controller had been researching activity-based costing and decided to switch to it. A
special study determined National’s two products have the following budgeted activities:
High F Great P
Engineering and design hours 969 1,440
Quality control inspection hours 5,648 7,200
Machine hours 20,286 13,440
Labor hours 12,000 14,400
Using activity-based costing, applied miscellaneous overhead for the Great P model per unit is
(rounded to the nearest cent):
81. National Inc. manufactures two models of CMD that can be used as cell phones, MPX,
and digital camcorders.
Model Annual Sales in Units
High F 10,000
Great P 16,000
National uses a volume-based costing system to apply factory overhead based on direct labor
dollars. The unit prime costs of each product were as follows:
High F Great P
Direct materials $38.00 $25.40
Direct labor $17.52 $13.14
Budget factory overhead:
Engineering and Design 2,409 engineering hours $404,712
Quality Control 12,848 inspection hours 269,808
Machinery 33,726 machine hours 539,616
Miscellaneous Overhead 26,400 direct labor hours 134,904
Total $1,349,040
National’s controller had been researching activity-based costing and decided to switch to it. A
special study determined National’s two products have the following budgeted activities:
High F Great P
Engineering and design hours 969 1,440
Quality control inspection hours 5,648 7,200
Machine hours 20,286 13,440
Labor hours 12,000 14,400
Using activity-based costing, total overhead per unit of Great P model is (rounded to the nearest
cent):
82. Sheen Co. manufacturers laser printers. It has outlined the following overhead cost
drivers:
Overhead Costs Pool Cost Driver Overhead Cost Budgeted Level for Cost Driver
Quality control Number of inspections $64,800 1,080
Machine operation Machine hours 132,000 1,100
Materials handling Number of batches 900 30
Miscellaneous overhead cost Direct labor hours 48,000 4,000
Sheen Co. has an order for 1,000 laser printers that has the following production requirements:
Number of inspections 175
Machine hours 180
Number of batches 5
Direct labor hours 650
Using activity-based costing, applied quality control factory overhead for the 1,000 laser printers
order is:
83. Sheen Co. manufacturers laser printers. It has outlined the following overhead cost
drivers:
Overhead Costs Pool Cost Driver Overhead Cost Budgeted Level for Cost Driver
Quality control Number of inspections $64,800 1,080
Machine operation Machine hours 132,000 1,100
Materials handling Number of batches 900 30
Miscellaneous overhead cost Direct labor hours 48,000 4,000
Sheen Co. has an order for 1,000 laser printers that has the following production requirements:
Number of inspections 175
Machine hours 180
Number of batches 5
Direct labor hours 650
Using activity-based costing, applied machine repetition overhead for the 1,000 laser printers
order is:
84. Sheen Co. manufacturers laser printers. It has outlined the following overhead cost
drivers:
Overhead Costs Pool Cost Driver Overhead Cost Budgeted Level for Cost Driver
Quality control Number of inspections $64,800 1,080
Machine operation Machine hours 132,000 1,100
Materials handling Number of batches 900 30
Miscellaneous overhead cost Direct labor hours 48,000 4,000
Sheen Co. has an order for 1,000 laser printers that has the following production requirements:
Number of inspections 175
Machine hours 180
Number of batches 5
Direct labor hours 650
Using activity-based costing, applied materials handling factory overhead for the 1,000 laser
printers order is:
85. Sheen Co. manufacturers laser printers. It has outlined the following overhead cost
drivers:
Overhead Costs Pool Cost Driver Overhead Cost Budgeted Level for Cost Driver
Quality control Number of inspections $64,800 1,080
Machine operation Machine hours 132,000 1,100
Materials handling Number of batches 900 30
Miscellaneous overhead cost Direct labor hours 48,000 4,000
Sheen Co. has an order for 1,000 laser printers that has the following production requirements:
Number of inspections 175
Machine hours 180
Number of batches 5
Direct labor hours 650
Using activity-based costing, applied miscellaneous factory overhead for the 1,000 laser printers
order based on direct labor hours is:
86. Sheen Co. manufacturers laser printers. It has outlined the following overhead cost
drivers:
Overhead Costs Pool Cost Driver Overhead Cost Budgeted Level for Cost Driver
Quality control Number of inspections $64,800 1,080
Machine operation Machine hours 132,000 1,100
Materials handling Number of batches 900 30
Miscellaneous overhead cost Direct labor hours 48,000 4,000
Sheen Co. has an order for 1,000 laser printers that has the following production requirements:
Number of inspections 175
Machine hours 180
Number of batches 5
Direct labor hours 650
What is the total overhead cost per unit of the laser printers order using activity-based costing
(rounded to the nearest cent)?
87. Diamond Cleats Co. manufactures cleats for baseball shoes. It has outlined the following
overhead cost drivers:
Overhead Cost Pool Cost Driver Overhead Cost Budgeted Level for Cost Driver
Budgeted
Quality Control # of inspections $78,000 1,200
Machine Time Machine hours 188,000 800
Materials Handling # of Batches 1,200 50
Miscellaneous Overhead Cost Direct labor hours 59,000
5,000
Diamond Cleats Co. has an order for cleats that has the following production requirements:
Number of Inspections 375
Number of Machine hours 220
Number of Batches 8
Direct Labor Hours 840
Using activity-based costing, applied quality control factory overhead for the baseball cleat order
is:
88. Diamond Cleats Co. manufactures cleats for baseball shoes. It has outlined the following
overhead cost drivers:
Overhead Cost Pool Cost Driver Overhead Cost Budgeted Level for Cost Driver
Budgeted
Quality Control # of inspections $78,000 1,200
Machine Time Machine hours 188,000 800
Materials Handling # of Batches 1,200 50
Miscellaneous Overhead Cost Direct labor hours 59,000
5,000
Diamond Cleats Co. has an order for cleats that has the following production requirements:
Number of Inspections 375
Number of Machine hours 220
Number of Batches 8
Direct Labor Hours 840
Using activity-based costing, applied machine overhead for the baseball cleat order is:
89. Diamond Cleats Co. manufactures cleats for baseball shoes. It has outlined the following
overhead cost drivers:
Overhead Cost Pool Cost Driver Overhead Cost Budgeted Level for Cost Driver
Budgeted
Quality Control # of inspections $78,000 1,200
Machine Time Machine hours 188,000 800
Materials Handling # of Batches 1,200 50
Miscellaneous Overhead Cost Direct labor hours 59,000
5,000
Diamond Cleats Co. has an order for cleats that has the following production requirements:
Number of Inspections 375
Number of Machine hours 220
Number of Batches 8
Direct Labor Hours 840
Using activity-based costing, applied materials handling factory overhead for the baseball cleat
order is:
90. Diamond Cleats Co. manufactures cleats for baseball shoes. It has outlined the following
overhead cost drivers:
Overhead Cost Pool Cost Driver Overhead Cost Budgeted Level for Cost Driver
Budgeted
Quality Control # of inspections $78,000 1,200
Machine Time Machine hours 188,000 800
Materials Handling # of Batches 1,200 50
Miscellaneous Overhead Cost Direct labor hours 59,000
5,000
Diamond Cleats Co. has an order for cleats that has the following production requirements:
Number of Inspections 375
Number of Machine hours 220
Number of Batches 8
Direct Labor Hours 840
Using activity-based costing, applied miscellaneous factory overhead for the baseball cleat order
based on direct labor hours is:
91. Diamond Cleats Co. manufactures cleats for baseball shoes. It has outlined the following
overhead cost drivers:
Overhead Cost Pool Cost Driver Overhead Cost Budgeted Level for Cost Driver
Budgeted
Quality Control # of inspections $78,000 1,200
Machine Time Machine hours 188,000 800
Materials Handling # of Batches 1,200 50
Miscellaneous Overhead Cost Direct labor hours 59,000
5,000
Diamond Cleats Co. has an order for cleats that has the following production requirements:
Number of Inspections 375
Number of Machine hours 220
Number of Batches 8
Direct Labor Hours 840
ABC costing helps an organization implement its strategy through all of the following means
except:
92. If Activity X had a budgeted cost of $125,000 and a budgeted activity consumption of
10,000 engineering hours, what would the activity consumption rate be?
93. Customer lifetime value is a type of analysis used to:
94. The cost of unused capacity can be determined using ABC costing for the purpose of:
95. Multistage ABC is used when:
96. An adaptation of ABC costing that simplifies ABC by assigning resource costs directly to
cost objects is called:
97. The Time Equation is used in ABC to:
98. In the context of ABC, cross-subsidization refers to:
99. Important concepts in resource consumption accounting include all of the following
except: