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linda_us, Master's Degree
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Experience:  Business Analyst and Solution Consultant with over 9 years of experience.
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1. Matt Company uses activity-based costing. The company

Resolved Question:

1.
Matt Company uses activity-based costing. The company has two products: A and B. The annual production and sales of Product A is 10,000 units and of Product B is 8,500 units. There are three activity cost pools, with total cost and total activity as follows:

Total Activity
Activity Cost Pool Total Cost Product A Product B Total
Activity 1 $31,280 190 490 680
Activity 2 $47,040 880 240 1,120
Activity 3 $131,200 850 3,250 4,100

The activity-based costing cost per unit of Product A is closest to: (Round your intermediate calculations to 2 decimal places.)

$11.28

$7.29

$5.89

$.79
2.
The controller of Ferrence Company estimates the amount of materials handling overhead cost that should be allocated to the company's two products using the data that are given below:

Wall Mirrors Specialty Windows
Total expected units produced 11,700 1,520
Total expected material moves 1,170 1,420
Expected direct labor-hours per unit 14 14

The total materials handling cost for the year is expected to be $16,663.30.

If the materials handling cost is allocated on the basis of direct labor-hours, how much of the total materials handling cost would be allocated to the Wall Mirrors? (Round your intermediate calculations to 4 decimal places.)

$9,581

$14,742

$7,932

$12,909
3.
Andujo Company allocates materials handling cost to the company's two products using the below data:

Modular Homes Prefab Barns
Total expected units produced 8,500 11,000
Total expected material moves 1,290 320
Expected direct labor-hour per unit 820 120

The total materials handling cost for the year is expected to be $213,000.

If the materials handling cost is allocated on the basis of material moves, how much of the total materials handling cost would be allocated to the Modular Homes? (Round your intermediate calculations to 5 decimal places.)

$170,665

$151,369

$189,961

$127,688
4.
Ollivier Corporation has an activity-based costing system with three activity cost pools-Processing, Supervising, and Other. In the first stage allocations, costs in the two overhead accounts, equipment expense and indirect labor, are allocated to the three activity cost pools based on resource consumption. Data used in the first stage allocations follow:

Overhead costs:
Equipment expense $129,000
Indirect labor $8,200

Distribution of Resource Consumption Across Activity
Cost Pools:
Activity Cost Pools
Processing Supervising Other
Equipment expense 0.60 0.20 0.20
Indirect labor 0.60 0.30 0.10

Processing costs are assigned to products using machine-hours (MHs) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow:

Activity:
MHs (Processing) Batches (Supervising)
Product C4 14,800 700
Product L7 1,210 970
Total 16,010 1,670

The activity rate for the Supervising activity cost pool under activity-based costing is closest to:

$82.16 per batch

$12.22 per batch

$16.92 per batch

$6.11 per batch
5.
Brisky Corporation uses activity-based costing to compute product margins. In the first stage, the activity-based costing system allocates two overhead accounts-equipment depreciation and supervisory expense-to three activity cost pools-Machining, Order Filling, and Other-based on resource consumption. Data to perform these allocations appear below:

Overhead costs:
Equipment depreciation $39,000
Supervisory expense $11,500

Distribution of Resource Consumption Across Activity Cost Pools:
Activity Cost Pools
Machining Order Filling Other
Equipment depreciation 0.50 0.30 0.20
Supervisory expense 0.50 0.20 0.30

In the second stage, Machining costs are assigned to products using machine-hours (MHs) and Order Filling costs are assigned to products using the number of orders. The costs in the Other activity cost pool are not assigned to products.

Activity:
MHs (Machining) Orders (Order Filling)
Product I3 5,540 138
Product U8 23,900 940
Total 29,440 1,078

Finally, sales and direct cost data are combined with Machining and Order Filling costs to determine product margins.

Sales and Direct Cost Data:
Product I3 Product U8
Sales (total) $61,700 $69,300
Direct materials (total) $31,700 $22,600
Direct labor (total) $20,300 $31,400

What is the overhead cost assigned to Product I3 under activity-based costing? (Round your intermediate calculations to 2 decimal places.)

$1,793.00

$6,557.00

$25,250.00

$4,764.00
6.
Capizzi Corporation has an activity-based costing system with three activity cost pools-Machining, Order Filling, and Other. In the first stage allocations, costs in the two overhead accounts, equipment depreciation and supervisory expense, are allocated to three activity cost pools based on resource consumption. Data used in the first stage allocations follow:

Overhead costs:
Equipment depreciation $79,300
Supervisory expense $4,800

Distribution of Resource Consumption Across Activity Cost Pools:
Activity Cost Pools
Machining Order Filling Other
Equipment depreciation 0.60 0.20 0.20
Supervisory expense 0.60 0.10 0.30

Machining costs are assigned to products using machine-hours (MHs) and Order Filling costs are assigned to products using the number of orders. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow:

Activity:
MHs (Machining) Batches (Order Filling)
Product Y7 1,600 620
Product V2 9,000 1,880
Total 10,600 2,500

How much overhead cost is allocated to the Order Filling activity cost pool under activity-based costing?

$15,860

$62,960

$480

$16,340

7.
Walsh Company expects sales of Product W to be 64,000 units in April, 79,000 units in May and 74,000 units in June. The company desires that the inventory on hand at the end of each month be equal to 40% of the next month's expected unit sales. Due to excessive production during March, on March 31 there were 29,000 units of Product W in the ending inventory. Given this information, Walsh Company's production of Product W for the month of April should be:

66,600 units

69,840 units

64,000 units

79,000 units
8.
Veltri Corporation is working on its direct labor budget for the next two months. Each unit of output requires 0.74 direct labor-hours. The direct labor rate is $10.40 per direct labor-hour. The production budget calls for producing 7,200 units in October and 6,800 units in November. The company guarantees its direct labor workers a 40-hour paid work week. With the number of workers currently employed, that means that the company is committed to paying its direct labor work force for at least 5,480 hours in total each month even if there is not enough work to keep them busy. What would be the total combined direct labor cost for the two months?

$112,403.20

$113,984.00

$109,324.80

$107,744.00
9.
Shuck Inc. bases its manufacturing overhead budget on budgeted direct labor-hours. The direct labor budget indicates that 7,600 direct labor-hours will be required in May. The variable overhead rate is $1.40 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $100,420 per month, which includes depreciation of $8,930. All other fixed manufacturing overhead costs represent current cash flows. The May cash disbursements for manufacturing overhead on the manufacturing overhead budget should be:

$10,640

$91,490

$102,130

$111,060
10.
The manufacturing overhead budget at Latronica Corporation is based on budgeted direct labor-hours. The direct labor budget indicates that 6,800 direct labor-hours will be required in August. The variable overhead rate is $7.30 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $138,720 per month, which includes depreciation of $24,890. All other fixed manufacturing overhead costs represent current cash flows. The company recomputes its predetermined overhead rate every month. The predetermined overhead rate for August should be:

$20.40

$27.70

$7.30

$24.20
11.
Mosbey Inc. is working on its cash budget for June. The budgeted beginning cash balance is $17,000. Budgeted cash receipts total $176,000 and budgeted cash disbursements total $175,000. The desired ending cash balance is $47,000. The excess (deficiency) of cash available over disbursements for June will be:

$1,000

$16,000

$193,000

$18,000
12.
Sartain Corporation is in the process of preparing its annual budget. The following beginning and ending inventory levels are planned for the year.

Beginning Inventory Ending Inventory
Finished goods (units) 26,000 76,000
Raw material (grams) 56,000 46,000

Each unit of finished goods requires 2 grams of raw material.

If the company plans to sell 730,000 units during the year, the number of units it would have to manufacture during the year would be:

730,000 units

780,000 units

806,000 units

674,000 units
13.
Sartain Corporation is in the process of preparing its annual budget. The following beginning and ending inventory levels are planned for the year.

Beginning Inventory Ending Inventory
Finished goods (units) 29,000 79,000
Raw material (grams) 59,000 49,000

Each unit of finished goods requires 2 grams of raw material.

If the company plans to sell 760,000 units during the year, how much of the raw material should the company purchase during the year?

1,669,000 grams

1,610,000 grams

1,639,000 grams

1,620,000 grams
14.
LHU Corporation makes and sells a product called Product WZ. Each unit of Product WZ requires 3.1 hours of direct labor at the rate of $27.00 per direct labor-hour. Management would like you to prepare a Direct Labor Budget for June.

The budgeted direct labor cost per unit of Product WZ would be:

$7.20

$50.50

$27.00

$83.70
15.
Thomasson Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports. The cost formula for plane operating costs is $36,210 per month plus $2,052 per flight plus $1 per passenger. The company expected its activity in April to be 81 flights and 231 passengers, but the actual activity was 80 flights and 236 passengers. The actual cost for plane operating costs in April was $196,000. The activity variance for plane operating costs in April would be closest to:

$2,047 U

$6,653 U

$6,653 F

$2,047 F
16.
Cadavieco Detailing's cost formula for its materials and supplies is $2,080 per month plus $14 per vehicle. For the month of November, the company planned for activity of 88 vehicles, but the actual level of activity was 48 vehicles. The actual materials and supplies for the month was $2,570.

The materials and supplies in the planning budget for November would be closest to:

$3,312

$2,752

$4,903

$2,570
17.
Gourley Clinic uses client-visits as its measure of activity. During August, the clinic budgeted for 3,900 client-visits, but its actual level of activity was 3,850 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting:

Fixed element per month Variable element per client-visit
Revenue — $40.40

Personnel expenses $36,400 $11.60
Medical supplies 2,400 8.40
Occupancy expenses 9,400 2.40
Administrative expenses 6,400 .60
Total expenses $54,600 $23.00


The activity variance for net operating income in August would be closest to:

$870 F

$870 U

$120 F

$120 U
18.
Galante Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During May, Kennel budgeted for 4,400 tenant-days, but its actual level of activity was 4,380 tenant-days. Kennel has provided the following data concerning the formulas used in its budgeting and its actual results for May:

Data used in budgeting:
Fixed element
per month Variable element per tenant-day
Revenue — $30.90

Wages and salaries $3,400 $6.90
Expendables 800 11.70
Facility expenses 8,400 3.90
Administrative expenses 8,200 0.30
Total expenses $20,800 $22.80

Actual results for May:
Revenue $108,180

Wages and salaries $23,540
Expendables $36,794
Facility expenses $19,290
Administrative expenses $9,148

The net operating income in the flexible budget for May would be closest to:

$14,678

$19,314

$19,408

$14,840

19.
Diskind Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During October, the company budgeted for 6,400 units, but its actual level of activity was 6,350 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for October:

Data used in budgeting:
Fixed element
per month Variable element
per unit
Revenue $33.90
Direct labor $0 $5.90
Direct materials 0 13.50
Manufacturing overhead 34,000 1.40
Selling and administrative expenses 25,200 .60
Total expenses $ 59,200 $21.40

Actual results for October:
Revenue $216,300
Direct labor $36,930
Direct materials $86,900
Manufacturing overhead $42,000
Selling and administrative expenses $30,440

The spending variance for direct materials in October would be closest to:

$1,175 F

$1,175 U

$500 F

$500 U
20.
Hurren Corporation makes a product with the following standard costs:

Inputs Standard Quantity or Hours Standard Price or Rate Standard Cost Per Unit
Direct materials 3.7 grams $5.00 per gram $18.50
Direct labor 0.9 hours $12.00 per hour $10.80
Variable overhead 0.9 hours $5.00 per hour $4.50

The company reported the following results concerning this product in June.

Originally budgeted output 8,000 units
Actual output 7,900 units
Raw materials used in production 28,310 grams
Actual direct labor-hours 6,500 hours
Purchases of raw materials 31,100 grams
Actual price of raw materials purchased $5.10 per gram
Actual direct labor rate $12.90 per hour
Actual variable overhead rate $4.70 per hour

The company applies variable overhead on the basis of direct labor-hours. The direct materials price variance is computed when the materials are purchased.

The labor rate variance for June is: (Round your intermediate calculations to 2 decimal places.)

$5,850 U

$6,399 U

$5,850 F

$6,399 F
21.
Hurren Corporation makes a product with the following standard costs:

Inputs Standard Quantity or Hours Standard Price or Rate Standard Cost Per Unit
Direct materials 4.5 grams $5.00 per gram $22.50
Direct labor 0.8 hours $10.00 per hour $8.00
Variable overhead 0.8 hours $5.00 per hour $4.00

The company reported the following results concerning this product in June.

Originally budgeted output 6,700 units
Actual output 6,600 units
Raw materials used in production 28,390 grams
Actual direct labor-hours 4,900 hours
Purchases of raw materials 31,900 grams
Actual price of raw materials purchased $5.10 per gram
Actual direct labor rate $10.90 per hour
Actual variable overhead rate $4.70 per hour

The company applies variable overhead on the basis of direct labor-hours. The direct materials price variance is computed when the materials are purchased.

The variable overhead rate variance for June is: (Round your intermediate calculations to 2 decimal places.)

$1,584 F

$1,470 F

$1,470 U

$1,584 U
22.
Tidd Corporation makes a product with the following standard costs:

Inputs Standard Quantity or Hours Standard Price or Rate Standard Cost Per Unit
Direct materials 4.9 grams $3.00 per gram $14.70
Direct labor 0.6 hours $16.00 per hour $9.60
Variable overhead 0.6 hours $3.00 per hour $1.80

The company reported the following results concerning this product in November.

Originally budgeted output 8,500 units
Actual output 8,600 units
Raw materials used in production 44,690 grams
Purchases of raw materials 47,180 grams
Actual direct labor-hours 7,750 hours
Actual cost of raw materials purchases $132,320
Actual direct labor cost $125,013
Actual variable overhead cost $21,786

The company applies variable overhead on the basis of direct labor-hours. The direct materials price variance is computed when the materials are purchased.

The variable overhead rate variance for November is: (Do not round intermediate calculations.)

$1,330 U

$1,464 U

$1,464 F

$1,330 F
23.
Landram Corporation makes a product with the following standard costs:

Inputs Standard Quantity or Hours Standard Price or Rate
Direct materials 2.0 kilos $7.00 per kilo
Direct labor 1.6 hours $12.00 per hour
Variable overhead 1.6 hours $6.00 per hour

In March the company produced 5,000 units using 10,340 kilos of the direct material and 2,320 direct labor-hours. During the month, the company purchased 10,910 kilos of the direct material at a cost of $76,790. The actual direct labor cost was $38,244 and the actual variable overhead cost was $11,945.

The company applies variable overhead on the basis of direct labor-hours. The direct materials price variance is computed when the materials are purchased.

The materials quantity variance for March is:

$2,380 F

$2,393 U

$2,380 U

$2,393 F
24.
The following standards for variable manufacturing overhead have been established for a company that makes only one product:

Standard hours per unit of output 4.60 hours
Standard variable overhead rate $11.55 per hour

The following data pertain to operations for the last month:

Actual hours 8,500 hours
Actual total labor cost $95,930
Actual output 1,700 units

What is the variable overhead rate variance for the month? (Do not round intermediate calculations.)

$2,245 U

$2,526 U

$2,526 F

$2,245 F
25.
The following standards for variable manufacturing overhead have been established for a company that makes only one product:

Standard hours per unit of output 5.20 hours
Standard variable overhead rate $11.65 per hour

The following data pertain to operations for the last month:

Actual hours 8,700 hours
Actual total labor cost $95,990
Actual output 1,600 units

What is the variable overhead efficiency variance for the month? (Do not round intermediate calculations.)

$2,412 U

$7,253 F

$7,253 U

$4,427 U
Submitted: 1 year ago.
Category: Multiple Problems
Expert:  linda_us replied 1 year ago.
Thanks for requesting me.

Please let me know the deadline for this assignment.
Customer: replied 1 year ago.


I need it by the evening of December 1st or at the latest the morning of Dec 2nd.

Expert:  linda_us replied 1 year ago.
I will post the solution well before your deadline.
Expert:  linda_us replied 1 year ago.
Hi

I'm just following up with you to see how everything is going. Did my answer help?

Let me know,

Linda
Customer: replied 1 year ago.


Lisa can I wait till Monday to rate your services. Everything has been great so far I just want to see if your answers were at least or mostly correct.


 


Crystal

Expert:  linda_us replied 1 year ago.

Sure no problem. By the way are you from Toronto, Canada?

Customer: replied 1 year ago.


Linda,


 


Thank you so much for your help. All of your answers were correct!


And to answer your question I am not from Canada.

Expert:  linda_us replied 1 year ago.
Good to know that all the answers are correct. Please rate my solution by clicking smilies (Excellent Service).

If you want to request me in future just write "FOR LINDA" in front of your post.
linda_us, Master's Degree
Satisfied Customers: 7037
Experience: Business Analyst and Solution Consultant with over 9 years of experience.
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