80.2K

Verified Solution

Link Copied!

please help me learn how to do this

Meryl Manufacturing Company is a diversified manufacturer that manufactures three products (Sine, Cos and Tan) in a continuous production process. Senior management has asked the controller to conduct an activitybased costing study. The controller idensified the amount of factory overhead required by the critical activities of the organization as follows: \begin{tabular}{|c|c|c|} \hline Activities & Activity Cost Pool & Activity Base \\ \hline Production & $313500 & Machine Hours (MH) \\ \hline Setup & 579800 & Number of Snotups \\ \hline Matorials handiling & 514,800 & Number of Parts \\ \hline Inspection & $800500 & Number of insp. Hours (1H) \\ \hline Product engueesing & $142,600 & Number of Eng. Hours (EH) \\ \hline & $631,200 & \\ \hline \end{tabular} The activity-base usage quantities and units produced for the three products were determined from corporate records and are as follows: \begin{tabular}{|l|r|r|r|r|r|r|} \hline & Number of MH & Number of Setups & Number of Parts & Number of IH & Number of EH & Number of Units \\ \hline & & & & & & \\ \hline \end{tabular} Each product requires 45 minutes per unit of machine time. Required: 1. Determine the activity rate for each activity. Round all per unit amounts to the nearest cent. Formula: Activity rate = Activity cost pool + Number of activity base \begin{tabular}{|c|c|c|c|c|} \hline Activities & Activify Cost Pool & Number of Activity Base & Activity rate & \\ \hline Production & & TMachine Hours & & per MH \\ \hline Setup & & Number of Sesugs & & per setup \\ \hline Materials handing & & Number of Parts & & per part \\ \hline Inspection & & Number of IH & & per lH \\ \hline Product engneering & & Number of EH & & per EH \\ \hline \end{tabular} 2. Determine the total and per-unit activity cost for all three products. Round all total costs to whole number and round all per unit amounts to the nearest cent. Formula: Activity-Base Usage Activity rate from Req. (1)= Activity cost: Sum all ectivity costs per product to defermine the fotal activity costs and Divide the total actwity overhead by budgefed inits fo compute the activity costs per unit for each product. \begin{tabular}{|c|c|c|c|c|c|c|c|} \hline Products & Production & Setup & Materials handiling & Inspection & Product engineorin & Total costs & Unit cost \\ \hline & 3 & 5 & s & & & & s per unit \\ \hline sine & & & & & & & \\ \hline cos & & & & & & & \\ \hline Tan & & & & & & & \\ \hline rotat & & & & & & & \\ \hline \end{tabular} 3. Why aren't the activity unit costs equal across all three products since thev require the same machine time per unit? Type

Answer & Explanation Solved by verified expert

See Answer