Sample Test Paper ACC420 Jimmy LTD is a manufacturing company that makes mobile

Question

Sample Test Paper ACC420 Jimmy LTD is a manufacturing company that makes mobile phones. The manager in the account department has the list provided to him: asked the staff to forecast the manufacturing overhead for the following year. Below is Cost $150000 $85000 $45000 $190000 Categories of activity Inspection Material handlings Maintenance The company has been a follows sked to submit a bid for a Model Z phones]. The estimates of the task is as $8500 500 15 Raw materials Machine hours # of material moves 3 of set ups 3 of inspections Direct Labour [2000 hours] Completed units 15 $15000 420 The list of budgeted activity is also provided. The four activity based cost drivers that would be used are: Machine hours. 25000 Material moves2000 Setups3000 Quality inspections 5000 Required 1 If the company uses functional-based costing and uses machine hours as the cost driver, what is the unit cost of the model 2. If the company uses activity based costing calculate the unit cost

Explanation / Answer

A) Calculation of COST PER UNIT FOR MODEL Z USING MACHINE HOUR RATE                          MODEL Z($) Direct material                                    8,500.00 Direct Labour                                        15,000.00 Overhead (working notes-1)                           9,400.00 Total (a)                                        32,900.00 No. of Units (b)                              420.00 Total cost per Unit (a/b)                                 78.33 Working Notes -1 INSEPECTION                       150,000.00 SETUPS                         85,000.00 MATERIAL HANDLING                         45,000.00 MAINTENANCE                       190,000.00 TOTAL OVERHEAD (A)                      470,000.00 Machine hr (B)                         25,000.00 Rate per hr (A/B)                                 18.80 OVERHEAD FOR MODEL Z(500*18.8) 9400 B) Calculation of UNIT COST AS PER ABC TOTAL INSPECTION SETUPS MATERIAL HANDLINGS MAINTENANCE OVERHEAD (a)           470,000.00                       150,000.00                          85,000.00                           45,000.00         190,000.00 Drivers (b)                           5,000.00                             3,000.00                             2,000.00           25,000.00 DRIVERS   QUALITY INSPECTION SETUPS MTERIAL MOVES MACHINE HR Activity Rate (a/b)                                 30.00                                  28.33                                   22.50                     7.60                          MODEL Z($) Direct material                                    8,500.00 Direct Labour                                        15,000.00 INSPECTION                           4,500.00 (30*15) SETUPS                              141.65 (28.33*5) MATERIAL HANDLINGS                              337.50 (15*22.5) MAINTENANCE                           3,800.00 (500*7.6) Total cost (A)                         32,279.15 No. of Units (B)                              420.00 Total cost per Unit (A/B)                                 76.86

Related Questions

Navigate

• Browse (All)
• Browse S
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.