Processing costs are assigned to products using

Question

Assignment

hoen Nuptial Bakery makes very elaborate wedding cakes to order. The company has an activity-based costing system with three activity cost pools. The activity rate for the Size-Related activity cost pool is $0.96 per guest. (The greater the number of guests, the larger the cake.) The activity rate for the Complexity-Related cost pool is $28.92 per tier. (Cakes with more tiers are more complex.) Finally, the activity rate for the Order-Related activity cost pool is $78.19 per order. (Each wedding involves one order for a cake.) The activity rates include the costs of raw ingredients such as flour, sugar, eggs, and shortening. The activity rates do not include the costs of purchased decorations such as miniature statues and wedding bells, which are accounted for separately.

Data concerning two recent orders appear below:

	Nie Wedding	Strobl Wedding
Number of reception guests	68	183
Number of tiers on the cake	3	4
Cost of purchased decorations for cake	$15.45	$ 71.86

Assuming that all of the costs listed above are avoidable costs in the event that an order is turned down, what amount would the company have to charge for the Nie wedding cake to just break even?

$245.68

$78.19

$15.45

$297.27

Studler 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	71,250
Indirect labor	3,500

Distribution of Resource Consumption Across Activity Cost Pools:
	Activity Cost Pools
	Processing			Supervising			Other
Equipment expense		0.60			0.20			0.20
Indirect labor		0.10			0.50			0.40

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 Y4	1,725	115
Product R6	9,775	2,185
Total	11,500	2,300

What is the overhead cost assigned to Product R6 under activity-based costing?

$15,208

$34,964

$51,864

$36,656

The controller of Hartis Corporation 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	14,100	1,750
Total expected material moves	1,410	1,650
Expected direct labor-hours per unit	11	12

The total materials handling cost for the year is expected to be $17,214.30.

If the materials handling cost is allocated on the basis of material moves, the total materials handling cost allocated to the specialty windows is closest to: (Round your intermediate calculations to 2 decimal places.)

$8,251

$9,290

$6,603

$3,274

Mussenden 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	$	213,080
Supervisory expense	$	2,810

Distribution of Resource Consumption Across Activity Cost Pools:
	Activity Cost Pools
	Machining			Order Filling			Other
Equipment depreciation		0.60			0.10			0.30
Supervisory expense		0.50			0.20			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)				Orders (Order Filling)
Product P4		9,720				810
Product S4		17,280				1,890
Total		27,000				2,700

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

$8.10 per order

$79.96 per order

$1.04 per order

$5.86 per order

Ort Corporation has provided the following data from its activity-based costing accounting system:

Indirect factory wages	585,000
Factory equipment depreciation	320,000

Distribution of Resource Consumption across Activity Cost Pools:

Activity Cost Pools	Customer Orders	Product Processing	Other	Total
Indirect factory wages	45%	20%	35%	100%
Factory equipment depreciation	35%	50%	15%	100%

The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs that are not assigned to products.

How much indirect factory wages and factory equipment depreciation cost would NOT be assigned to products using the activity-based costing system?

$585,000

$252,750

$0

$320,000

Brummitt Corporation has two divisions: the BAJ Division and the CBB Division. The corporation's net operating income is $95,300. The BAJ Division's divisional segment margin is $45,800 and the CBB Division's divisional segment margin is $174,000. What is the amount of the common fixed expense not traceable to the individual divisions?

$124,500

$219,800

$269,300

$141,100

Cutterski Corporation manufactures a propeller. Shown below is Cutterski's cost structure:

	Variable cost per propeller	Total fixed cost for the year
Manufacturing cost	$123	$1,166,400
Selling and administrative expense	$ 32	$619,500

In its first year of operations, Cutterski produced 86,400 propellers but only sold 82,600.

What is the total cost that would be assigned to Cutterski's finished goods inventory at the end of the first year of operations under variable costing?

$668,800

$589,000

$467,400

$518,700

Bartelt Inc., which produces a single product, has provided the following data for its most recent month of operations: 

Number of units produced	1,100
Variable costs per unit:
Direct materials	56
Direct labor	49
Variable manufacturing overhead	7
Variable selling and administrative expenses	8
Fixed costs:
Fixed manufacturing overhead	42,900
Fixed selling and administrative expenses	81,400

There were no beginning or ending inventories. The absorption costing unit product cost was: 

$151 per unit

$233 per unit

$105 per unit

$112 per unit

O'Neill, Incorporated's segmented income statement for the most recent month is given below.

	Total Company	Store A	Store B
Sales	$403,000	$126,000	$277,000
Variable expenses	260,950	91,980	168,970
Contribution margin	142,050	34,020	108,030
Traceable fixed expenses	105,400	33,200	72,200
Segment margin	36,650	$820	$35,830
Common fixed expenses	36,450
Net operating income	$200

For each of the following questions, refer back to the above original data.

The marketing department believes that a promotional campaign at Store A costing $9,500 will increase sales by $28,500. If its plan is adopted, overall company net operating income should:

decrease by $1,805

increase by $17,195

increase by $1,805

decrease by $17,195

Carr Company produces a single product. During the past year, Carr manufactured 26,160 units and sold 20,900 units. Production costs for the year were as follows:

Direct materials	$188,352
Direct labor	$112,488
Variable manufacturing overhead	$224,976
Fixed manufacturing overhead	$470,880

Sales were $971,850 for the year, variable selling and administrative expenses were $108,680, and fixed selling and administrative expenses were $190,968. There was no beginning inventory. Assume that direct labor is a variable cost.

Under absorption costing, the ending inventory for the year would be valued at: (Do not round intermediate calculations.)

$227,906

$270,406

$200,406

$261,906