Question 29 Which of the following best describes sequential processing? Answers

Question

Question 29

Which of the following best describes sequential processing?

Answers

Units must pass sequentially through a process.

Units must pass through one process before they can be worked on in later processes.

Units which are not processed in the correct sequence will be discarded.

Sub-components can be worked on simultaneously in different processes and then brought together in a final process for completion.

Question 30
Figure 7-5.
Honeydew Company produces two products, a high end laptop computer under the label Bunsen Laptops, and an inexpensive desktop computer under the label Beaker Computers. The two products use two overhead activities, with the following costs:
Setting up equipment $ 2,000
Machining 12,000

The controller has collected the expected annual prime costs for each product, the machine hours, the setup hours, and the expected production.
Bunsen Beaker
Direct Labor $20,000 $5,000
Direct Materials 15,000 4,000
Units 2,000 2,000
Machine hours 750 1,500
Setup hours 50 50

Refer to Figure 7-5. Calculate Beaker’s consumption ratio for setup hours.
Answers


0.50

0.45

0.90

0.25

0.75


Question 31
Figure 7-5.
Honeydew Company produces two products, a high end laptop computer under the label Bunsen Laptops, and an inexpensive desktop computer under the label Beaker Computers. The two products use two overhead activities, with the following costs:
Setting up equipment $ 2,000
Machining 12,000

The controller has collected the expected annual prime costs for each product, the machine hours, the setup hours, and the expected production.
Bunsen Beaker
Direct Labor $20,000 $5,000
Direct Materials 15,000 4,000
Units 2,000 2,000
Machine hours 750 1,500
Setup hours 50 50


Refer to Figure 7-5. Calculate the overhead cost per unit for Bunsen Laptops, using a plantwide rate based on direct labor costs.
Answer


$9.63 per laptop

$22.45 per laptop

$5.60 per laptop

$7.22 per laptop

$7.50 per laptop



Question 32
Figure 7-5.
Honeydew Company produces two products, a high end laptop computer under the label Bunsen Laptops, and an inexpensive desktop computer under the label Beaker Computers. The two products use two overhead activities, with the following costs:
Setting up equipment $ 2,000
Machining 12,000


The controller has collected the expected annual prime costs for each product, the machine hours, the setup hours, and the expected production.
Bunsen Beaker
Direct Labor $20,000 $5,000
Direct Materials 15,000 4,000
Units 2,000 2,000
Machine hours 750 1,500
Setup hours 50 50


Refer to Figure 7-5. Calculate the overhead cost per unit for each Beaker Computer, using overhead rates based on machine hours and setup hours.
Answer


$6.10 per unit

$4.48 per unit

$5.75 per unit

$3.88 per unit





Question 33

Costs incurred to prevent poor quality in the products or services being produced are:
Answers


prevention costs.

appraisal costs.

internal failure costs.

external failure costs.

a different category of quality related costs.

Explanation / Answer

Q. 29 Which of the following best describes sequential processing?
         Units must pass through one process before they can be worked on in later processes.

Q. 30 Calculate Beaker’s consumption ratio for setup hours.
          50 / 100 = 0.50

Q.31 Calculate the overhead cost per unit for Bunsen Laptops, using a plantwide rate based on direct labor
        costs
        Total Overhead cost = $2,000 + $12,000 = $14,000
         Direct Labor ratio = 20:5
         Allocated Overhead cost to Bunsen = $14,000 X 20 / 25 = $11,200
         Overhead cost PU for Bunsen = $11,200/2,000 = $5.60

Q.32 Calculate the overhead cost per unit for each Beaker Computer, using overhead rates based on
         machine hours and setup hours.
        
         Seeting Up cost    = $2,000
         Setup Hours ratio = 50:50      Beaker       $1,000
         Machining Cost      = $12,000
         Machine hour ratio = 750:1500  Beaker       $8,000
         Allocated Overhead cost   to      Beaker      $9,000
         Overhead cost PU for Beaker = $9,000/2,000 = $4.50

Q. 33 Costs incurred to prevent poor quality in the products or services being produced are
          prevention costs.
         

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