3 Leaper Corporation uses an activity-based costing system with the following th

Question

3 Leaper Corporation uses an activity-based costing system with the following three activity cost pools: Total Activity machine- Activity Cost Pool Fabrication 45,000 hours 200 orders Order processing other Not applicable The Other activity cost pool is used to accumulate costs of idle capacity and organization-sustaining costs. The company has provided the following data concerning its costs: Wages and salarie Depreciation Occupancy Total $440,000 180,000 200,000 $820,000 The distribution of resource consumption across activity cost pools is given below Activity Cost Pools Other 35% 40% 35% Fabrication Order Processing Wages and salaries Depreciation Occupancy 358 158 358 30% 458 30% Total 100% 1008 1008

Explanation / Answer

Answer is $ 123.74 per unit.

Explanation:

STATEMENT SHOWING ACTIVITY RATE OF ACTIVITY POOL Activity Total Expected Activity ACTIVITY COST POOL Measures Overheads Activity Rate Assembly machine hours 926,800 56,000 16.55 per MH Processing orders Orders 68,310 1,800 37.95 Per order Inspection Inspection hours 103,360 1,360 76.00 Per Hour STATEMENT SHOWING ASSIGNMENT OF ACTIVITY COST TO ORDER AMOUNT $ Overheads assigned Assembly (1060 Mh @ 16.55) 17543 Processing Orders (80 orders @37.95) 3036 Inspection (20 hours @$76) 1520 Total overheads assigned 22099 Number of units 700 OH cost per unit 31.57 UNIT PRODUCT COST: Material 51 labour 41.17 OH 31.57 Total unit cost 123.74

Related Questions

Navigate

• Browse (All)
• Browse 3
• Subjects

---

---

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