Greenwood Company manufactures two products-15.000 units of Product Y and 7,000
ID: 2488174 • Letter: G
Question
Greenwood Company manufactures two products-15.000 units of Product Y and 7,000 units of Product Z. The company uses a overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates all of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products Y and Z: a. 1. Using the gjantwide overhead rate, what percentage of the total overhead cost is allocated to Product Y and Product Z? Total overhead cost Product Y % Product Z % 2. Using the ABC system, what percentage of the machirvg cost is assigned to product Product Y and Product Z. Machining cost Product Y % Product Z % 3. Using the ABC System what percentage of machine setups cost is assigned to product Y and Product Z? Machine setups cost Product Y % Product Z % 4. Using the ABC system, what percentage of the Product Design cost is assigned to Product Y and Product Z Product design cost Product Y % Product Z % 5. Using the ABC system what percentage of the general factory cost is assigned to product Y and Product Z. General factory cost Product Y % Product Z %|?Explanation / Answer
1. Total overhead cost = 221100+107100+85000+251000
= $ 665100
Product Y 665100*8100/10000 = $538731 (based on direcgt labour hours)
Product Z = 665100-538731
= $126369
2. Product Y = 221100*7100/11000 = $142710
Product Z = 221100*3900/110000 = $78390
3. Product Y = 107100 * 60/210 = $ 30600
Product Z = 107100*150/210 = $76500
4. Product Y = 85000*1/2 = $42500
Poduct Z = 85000*1/2 = $42500
5. Product Y = 251000*8100/10000 = $ 203310
Product Z = $47690
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