Hippity Hoppity Brew is a manufacturer of Small, Medium and Large size malting e

Question

Hippity Hoppity Brew is a manufacturer of Small, Medium and Large size malting equipment for use in craft breweries across the United States and Canada. They are implementing an activity based cost (ABC) system and have compiled the following indirect cost information.

During the period, the Medium sized equipment line at Hippity Hoppity Brew used 650 machine hours, used 6200 square feet of floor space, received 63 orders, experienced 13 engineering changes and had 8 warranty claims. $106300 of direct labor and $66266 of direct material were charged towards the Medium sized equipment line during the year.

Under the ABC system, how much total cost was charged to the Medium line during the year? round your answer to the whole dollar.

Cost Pool Estimated Cost Cost Driver Est Total Cost Driver Equipment Maintenance $42871 Machine Hours 1500 Hours Production Facility Costs $83163 Footprint (sqft) 20000 Square Feet Order Processing Costs $20829 Num of Orders 200 Orders Engineering Changes $35728 Num of Changes 50 Changes Customer Relations $29334 Warranty Claims 30 Claims

Explanation / Answer

Under the ABC system, how much total cost was charged to the Medium line during the year? round your answer to the whole dollar.

Direct material 66266 Direct labour 106300 Manufacturing overhead Equipment Maintenance (42871/1500*650) 18577 Production Facility Costs (83163/20000*6200) 25781 Order Processing Costs (20829/200*63) 6561 Engineering Changes (35728/50*13) 9289 Customer Relations (29334/30*8) 7822 Total cost charged to medium line 240596

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