Qinto Company sells two types of products: basic and deluxe. The company provides technical support for its productsat a budgeted overhead cost of $391,000 per year. The company allocates technical support cost based on 11,500budgeted technical support calls per year.1. Compute the activity rate for technical support using activity-based costing.2. During January, Qinto received 740 calls on its deluxe model and 170 calls on its basic model. Allocate technicalsupport costs to each model.Complete this question by entering your answers in the tabs below.Required Required12During January, Qinto received 740 calls on its deluxe model and 170 calls on its basicmodel. Allocate technical support costs to each model.Show lessAAllocate technical support costs to each modelActivityUsageAllocatedCostModelctivity RateBasicDeluxe< Required 1Required 2 > Qinto Company sells two types of products: basic and deluxe. The company provides technical support for its productsat a budgeted overhead cost of $391,000 per year. The company allocates technical support cost based on 11,500budgeted technical support calls per year.1. Compute the activity rate for technical support using activity-based costing.2. During January, Qinto received 740 calls on its deluxe model and 170 calls on its basic model. Allocate technicalsupport costs to each model.Complete this question by entering your answers in the tabs below.Required RequiredCompute the activity rate for technical support using activity-based costing.Technical support activity rateNumeratorDenominator< Required 1Required 2 >

Name: Qinto Company sells two types of products: basic and deluxe. The comp
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Description: Qinto Company sells two types of products: basic and deluxe. The company provides technical support for its productsat a budgeted overhead cost of $391,000 per year. The company allocates technical support cost based on 11,500budgeted technical supp

Technical support activity rate = Budgeted overhead cost/Budgeted support calls

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Qinto Company sells two types of products: basic and deluxe. The company provides technical support for its products at a budgeted overhead cost of $391,000 per year. The company allocates technical support cost based on 11,500 budgeted technical support calls per year. 1. Compute the activity rate for technical support using activity-based costing. 2. During January, Qinto received 740 calls on its deluxe model and 170 calls on its basic model. Allocate technical support costs to each model. Complete this question by entering your answers in the tabs below. Required Required During January, Qinto received 740 calls on its deluxe model and 170 calls on its basic model. Allocate technical support costs to each model. Show lessA Allocate technical support costs to each model Activity Usage Allocated Cost Model Activity Rate Basic Deluxe < Required 1 Required 2 >

Qinto Company sells two types of products: basic and deluxe. The company provides technical support for its products at a budgeted overhead cost of $391,000 per year. The company allocates technical support cost based on 11,500 budgeted technical support calls per year. 1. Compute the activity rate for technical support using activity-based costing. 2. During January, Qinto received 740 calls on its deluxe model and 170 calls on its basic model. Allocate technical support costs to each model. Complete this question by entering your answers in the tabs below. Required Required During January, Qinto received 740 calls on its deluxe model and 170 calls on its basic model. Allocate technical support costs to each model. Show lessA Allocate technical support costs to each model Activity Usage Allocated Cost Model Activity Rate Basic Deluxe < Required 1 Required 2 >

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter8: Budgeting

Section: Chapter Questions

Problem 4CMA: Krouse Company produces two products, forged putter heads and laminated putter heads, which are sold...

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Colonels uses a traditional cost system and estimates next years overhead will be $480,000, with the estimated cost driver of 240,000 direct labor hours. It manufactures three products and estimates these costs: If the labor rate is $25 per hour, what is the per-unit cost of each product?
Krouse Company produces two products, forged putter heads and laminated putter heads, which are sold through specialty golf shops. The company is in the process of developing itsoperating budget for the coming year. Selected data regarding the companys two products areas follows: Manufacturing overhead is applied to units using direct labor hours. Variable manufacturing overhead Ls projected to be 25,000, and fixed manufacturing overhead is expected to be15,000. The estimated cost to produce one unit of the laminated putter head is: a. 42. b. 46. c. 52. d. 62.
A company manufactures and sells blades that are used in riding lawnmowers. The 18-inch blade sells for $15 and has per-unit variable costs of $4 associated with its production. The company has fixed expenses of $85,000 per month. In January, the company sold 12,000 of the 18-inch blades. A. Calculate the contribution margin per unit for the 18-inch blade. B. Calculate the contribution margin ratio of the 18-inch blade. C. Prepare a contribution margin income statement for the month of January.
Box Springs, Inc., makes two sizes of box springs: twin and double. The direct material for the twin is $25 per unit and $40 s used in direct labor, while the direct material for the double is $40 per unit, and the labor cost is $50 per unit. Box Springs estimates it will make 5,000 twins and 9,000 doubles in the next year. It estimates the overhead for each cost pool and cost driver activities as follows: How much does each unit cost to manufacture?
SmokeCity, Inc., manufactures barbeque smokers. Based on past experience, SmokeCity has found that its total annual overhead costs can be represented by the following formula: Overhead cost = 543,000 + 1.34X, where X equals number of smokers. Last year, SmokeCity produced 20,000 smokers. Actual overhead costs for the year were as expected. Required: 1. What is the driver for the overhead activity? 2. What is the total overhead cost incurred by SmokeCity last year? 3. What is the total fixed overhead cost incurred by SmokeCity last year? 4. What is the total variable overhead cost incurred by SmokeCity last year? 5. What is the overhead cost per unit produced? 6. What is the fixed overhead cost per unit? 7. What is the variable overhead cost per unit? 8. Recalculate Requirements 5, 6, and 7 for the following levels of production: (a) 19,500 units and (b) 21,600 units. (Round your answers to the nearest cent.) Explain this outcome.
Gent Designs requires three units of part A for every unit of Al that it produces. Currently, part A is made by Gent, with these per-unit costs in a month when 4.000 units were produced: Variable manufacturing overhead is applied at $1.00 per unit. The other $0.30 of overhead consists of allocated fixed costs. Gent will need 6,000 units of part A for the next years production. Cory Corporation has offered to supply 6,000 units of part A at a price of $7.00 per unit. It Gent accepts the offer, all of the variable costs and $1,200 of the fixed costs will be avoided. Should Gent Designs accept the offer from Cory Corporation?
Box Springs. Inc., makes two sizes of box springs: queen and king. The direct material for the queen is $35 per unit and $55 is used in direct labor, while the direct material for the king is $55 per unit, and the labor cost is $70 per unit. Box Springs estimates it will make 4,300 queens and 3,000 kings in the next year. It estimates the overhead for each cost pool and cost driver activities as follows: How much does each unit cost to manufacture?
Remarkable Enterprises requires four units of part A for every unit of Al that it produces. Currently, part A is made by Remarkable, with these per-unit costs in a month when 4,000 units were produced: Variable manufacturing overhead is applied at $1.60 per unit. The other $0.50 of overhead consists of allocated fixed costs. Remarkable will need 8,000 units of part A for the next years production. Altoona Corporation has offered to supply 8,000 units of part A at a price of $8.00 per unit. If Remarkable accepts the offer, all of the variable costs and $2,000 of the fixed costs will be avoided. Should Remarkable accept the offer from Altoona Corporation?
Plata Company has identified the following overhead activities, costs, and activity drivers for the coming year: Plata produces two models of microwave ovens with the following activity demands: The companys normal activity is 21,000 machine hours. Calculate the total overhead cost that would be assigned to Model X using an activity-based costing system: a. 230,000 b. 240,000 c. 280,000 d. 190,000
Corazon Manufacturing Company has a purchasing department staffed by five purchasing agents. Each agent is paid 28,000 per year and is able to process 4,000 purchase orders. Last year, 17,800 purchase orders were processed by the five agents. Required: 1. Calculate the activity rate per purchase order. 2. Calculate, in terms of purchase orders, the: a. total activity availability b. unused capacity 3. Calculate the dollar cost of: a. total activity availability b. unused capacity 4. Express total activity availability in terms of activity capacity used and unused capacity. 5. What if one of the purchasing agents agreed to work half time for 14,000? How many purchase orders could be processed by four and a half purchasing agents? What would unused capacity be in purchase orders?
Business Specialty, Inc., manufactures two staplers: small and regular. The standard quantities of direct labor and direct materials per unit for the year are as follows: The standard price paid per pound of direct materials is 1.60. The standard rate for labor is 8.00. Overhead is applied on the basis of direct labor hours. A plantwide rate is used. Budgeted overhead for the year is as follows: The company expects to work 12,000 direct labor hours during the year; standard overhead rates are computed using this activity level. For every small stapler produced, the company produces two regular staplers. Actual operating data for the year are as follows: a. Units produced: small staplers, 35,000; regular staplers, 70,000. b. Direct materials purchased and used: 56,000 pounds at 1.5513,000 for the small stapler and 43,000 for the regular stapler. There were no beginning or ending direct materials inventories. c. Direct labor: 14,800 hours3,600 hours for the small stapler and 11,200 hours for the regular stapler. Total cost of direct labor: 114,700. d. Variable overhead: 607,500. e. Fixed overhead: 350,000. Required: 1. Prepare a standard cost sheet showing the unit cost for each product. 2. Compute the direct materials price and usage variances for each product. Prepare journal entries to record direct materials activity. 3. Compute the direct labor rate and efficiency variances for each product. Prepare journal entries to record direct labor activity. 4. Compute the variances for fixed and variable overhead. Prepare journal entries to record overhead activity. All variances are closed to Cost of Goods Sold. 5. Assume that you know only the total direct materials used for both products and the total direct labor hours used for both products. Can you compute the total direct materials and direct labor usage variances? Explain.
Natur-Gro, Inc., manufactures composters. Based on past experience, Natur-Gro has found that its total annual overhead costs can be represented by the following formula: Overhead cost = 264,000 + 1.42X, where X equals number of composters. Last year, Natur-Gro produced 30,000 composters. Actual overhead costs for the year were as expected. Total overhead for per unit was a. 1.42 b. 8.80 c. 11.63 d. 10.22