8. Dangerfield Enterprises produces three kinds of golf clubs: Fancy, Light, and
ID: 2542423 • Letter: 8
Question
8. Dangerfield Enterprises produces three kinds of golf clubs: Fancy, Light, and Disco. These unique clubs incur overhead costs during production. The manager at Dangerfield Enterprises examined the overhead costs and determined the cost drivers for each cost object.
ABC level
Overhead cost
Cost driver
Fancy
Light
Disco
Unit
$400,000
Number of units
2,300
2,500
3,200
Batch
$600,000
Number of set-ups
30
50
70
Product
$400,000
Percent of usage
30%
25%
45%
Facility
$800,000
Square feet
120,000
160,000
220,000
Using activity based costing, fill in the amount of overhead that is allocated to each product:
Fancy
Light
Disco
Unit Level:
Batch Level:
Product Level:
Facility Level:
Show work here please !!!!
ABC level
Overhead cost
Cost driver
Fancy
Light
Disco
Unit
$400,000
Number of units
2,300
2,500
3,200
Batch
$600,000
Number of set-ups
30
50
70
Product
$400,000
Percent of usage
30%
25%
45%
Facility
$800,000
Square feet
120,000
160,000
220,000
Explanation / Answer
Calculation of amount of overhead located: Fancy Light Disco Unit level 115000 125000 160000 (400000*0.2875, 400000*0.3125, 400000*0.40) Batch Level 120000 200000 280000 (600000*0.20, 600000*50/150, 600000*70/150) Product Level 120000 100000 180000 (400000*0.30, 400000*0.25, 400000*0.45) Facility level 192000 256000 352000 (800000*0.24, 800000*0.32, 800000*0.44) Working: Unit Level: Total units= 2300+2500+3200= 8000 Fancy= 2300/8000= 0.2875 Light= 2500/8000=0.3125 Disco= 3200/8000= 0.40 Batch Level: Total set up= 30+50+70= 150 Fancy= 30/150= 0.20 Light= 50/150 Disco= 70/150 Facility Level: Total squarefeet= 120000+160000+220000= 500000 Fancy= 120000/500000= 0.24 Light= 160000/500000= 0.32 Disco=220000/500000=0.44
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.