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Student Name:
Class:
Part a.
Estimated
Costs Rate
54,000$ 200 orders 270$ «- Correct!
Institutional Standard Silver Total
39,000$ 24,000$ 15,000$ 78,000$
Correct! Correct! Correct! Correct!
Institutional Standard Silver Total
39,000$ 24,000$ 15,000$ 78,000$
Part c.
Production costs using ABC
Account
Direct materials
Direct labor
Account
Direct materials
Production costs using direct labor hours
Part b.
Number of orders
Processing orders
Instructor
Cost Driver
KITCHEN SUPPLY, INC.
Activity
Driver Units
Problem 09-51
McGraw-Hill/Irwin
Estimated
Estimated Cost
Cost
Driver Activity
54,000$
Institutional Standard Silver
60,000 24,000 9,000
39,000$ 24,000$ 15,000$
7,500
Estimated direct labor-hours for Year 2
Direct materials costs
Given Data P09-51:
Additional Information:
Cost driver volumes in January, Year 2:
Activity
Year 2 cost estimates:
Number of units produced
KITCHEN SUPPLY, INC.
Cost Driver
Recommended
Number of orders
Processing orders
200 orders
Student Name:
Class:
Estimated Cost Driver
Cost Activity Rate
Machine hours 4,698,000$ 50,000 93.96$
Correct!
Route 66 Main Street Alley Cat Total
Correct!
Route 66 Main Street Alley Cat Total
7,600,000 11,200,000 9,500,000 28,300,000
Sales revenue
Part b.
Sales revenue
Direct costs:
Income Statement
Pickle Motorcycles, Inc.
All variable overhead
Income Statement
Pickle Motorcycles, Inc.
Activity
Cost Driver
Instructor
McGraw-Hill/Irwin
Problem 09-53
PICKLE MOTORCYCLES, INC.
Recommended
Part a.
Compute machine hour rate:
Route 66 Main Street Alley Cat Total
7,600,000$ 11,200,000$ 9,500,000$ 28,300,000$
3,000,000 4,800,000 4,000,000 11,800,000
288,000 480,000 1,080,000 1,848,000
Activity Route 66 Main Street Alley Cat
22 34 44
Recommended cost allocation bases:
Given Data P09-53:
Sales revenue
Direct costs
Direct materials
Direct labor
PICKLE MOTORCYCLES, INC.
Income Statement
Activity Level
Setting up machines
Number of production runs
Cost Driver
Student Name:
Class:
Oval Round Square Total
240,000 240,000 240,000 720,000
Costs Activity
1,350,000 90,000
Estimated Cost Driver Burden Rate
Cost Activity per DLH
Labor hours 6,300,000$ 15,000 420.00$
Correct!
Oval Round Square
Correct! Correct! Correct!
Estimated
Cost Rate
Oval Round Square
240,000$ 240,000$ 240,000$
Compute cost per unit with ABC
Part d.
Direct Costs
Compute cost per unit:
Total overhead
Compute overhead rate per labor hour:
Activity
Cost Driver
Cost Driver
Cost pools
Cost pools
Instructor
McGraw-Hill/Irwin
Problem 09-54
CHURCHILL PRODUCTS
Products
Total direct costs
Budgeted
Part a.
Cost Drivers
Machine hours
Recommended
Recommended
Compute Activity-based rates:
Part c.
Utilities
Costs
1,350,000$ 90,000
Oval Round Square
240,000$ 240,000$ 240,000$
Utilities
Total direct costs (material and labor)
Given Data P09-54:
Drivers
Activity
Products
CHURCHILL PRODUCTS
Next year's plans and budget:
machine-hours
Cost Pools
Overhead cost pools:
Student Name:
Class:
M3100 M4100 M6100
10 20 20
Compute machine hour rate:
Estimated Cost Driver
Cost Activity Rate
Machine hours 8,700,000$ 25,000 348.00$
Correct!
M3100 M4100 M6100 Total
9,000,000$ 15,000,000$ 13,500,000$ 37,500,000$
Correct!
Activity Unit
Cost Volume Rate
2,400,000$ 50 48,000$ «- Correct!
M3100 M4100 M6100 Total
9,000,000$ 15,000,000$ 13,500,000$ 37,500,000$
Correct!
Sales revenue
Direct costs:
Setting up machines
Part a.
Setting up machine
All variable overhead
Activity
Income Statement
Problem 09-59
McGraw-Hill/Irwin
Instructor
Production runs
MTI
Recommended
Cost Driver
Activity Level
Recommended
Activity
Production runs
Cost Driver
MTI
MTI
Income Statement
Cost Driver
Activity
Sales revenue
Compute Activity-based rates:
Part b.
M3100 M4100 M6100 Total
9,000,000$ 15,000,000$ 13,500,000$ 37,500,000$
3,000,000 4,500,000 3,300,000 10,800,000
M3100 M4100 M6100 Total
10,000 17,500 10,000 37,500
M3100 M4100 M6100
10 20 20
Production runs
Setting up machines
Activity
Units produced last year:
Employee team recommendations:
Income Statement
MTI
Cost Driver
Given Data P9-59:
Sales revenue
Direct costs:
Direct materials
