31. PRODUCT COST SCHEDULE Prepare a cost schedule for Austin Company for Product
ID: 2605849 • Letter: 3
Question
31. PRODUCT COST SCHEDULE Prepare a cost schedule for Austin Company for Product X and Product Y using the following layout: (Input Area) Product X Product Y Total Units DM Cost/Unit DL Cost/Unit OH allocation rate Total OH (X & Y) (Output Area) Company Name Product Cost Schedule Date Product X Product Y Direct Materials Direct Labor Manufacturing Overhead Total Cost The costs of the direct material for the two products are $2.00 per unit for X and $3.00 pet unit for Y. The direct labor costs are $.25 per unit produced for either product. The total manufacturing overhead for the year is $300,000. This should be allocated to the different products based on the ratio of each product's production to total production. Austin Company produced 100,000 units of product X and 50,000 units of product Y.Explanation / Answer
Answer
It is mentioned that Manufacturing Overhead will be divided between the Product according to the production of Product.
Product share = (Product production / Total Production) * Total Manufacturing Overhead
Product X= (100,000 Units / 150,000 Units) * $300,000
Product X = $200,000
Product Y= (50,000 Units / 150,000 Units) * $300,000
Product Y = $100,000
Overhead Allocation rate = Total Overhead / Total Production of Product X and Y
= $300,000 / 150,000 Units
Overhead Allocation rate = $2 per Unit
Input Area
Product X
Product Y
Total Units
100,000
50,000
DM Cost/Unit
2
3
DL Cost/Unit
0.25
0.25
OH Allocation Rate
2 Per Unit
2 Per Unit
Total OH (X&Y)
300,000
Output Area
Product X
Product Y
Direct Material
200,000
150,000
Direct Labor
25,000
12,500
Manufacturing Overhead
200,000
100,000
Total cost
425,000
262,500
Input Area
Product X
Product Y
Total Units
100,000
50,000
DM Cost/Unit
2
3
DL Cost/Unit
0.25
0.25
OH Allocation Rate
2 Per Unit
2 Per Unit
Total OH (X&Y)
300,000
Output Area
Product X
Product Y
Direct Material
200,000
150,000
Direct Labor
25,000
12,500
Manufacturing Overhead
200,000
100,000
Total cost
425,000
262,500
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