80. Panamint Systems Corporation is estimating activity costs associated with producing disk drives, tapes drives, and wire drives. The indirect labor can be traced to four separate activity pools. The budgeted activity cost and activity base data by product are provided below.
ActivityCost
Activity Base
Procurement
$ 370,000
Number of purchase orders
Scheduling
250,000
Number of production orders
Materials handling
500,000
Number of moves
Product development
730,000
Number of engineering changes
Production
1,500,000
Machine hours
Number ofPurchaseOrders
Numberof ProductionOrders
NumberofMoves
Number of EngineeringChanges
MachineHours
NumberofUnits
Disk drives
4,000
300
1,400
10
2,000
2,000
Tape drives
4,000
150
800
10
8,000
4,000
Wire drives
12,000
800
4,000
25
10,000
2,500
Determine the activity-based cost for each wire drive unit. A. $204.13B. $173.51C. $744.06D. $394.12
81. Determine the activity-based cost for each tape drive unit. A. $97.73B. $232.69C. $394.12D. $103.84
82. Which of the following is not a cost pool used with the activity-based costing method? A. direct labor hoursB. production setupsC. machine hoursD. all are ABC cost pools
83. Activity rates are determined by A. dividing the actual cost for each activity pool by the actual activity base for that pool.B. dividing the cost budgeted for each activity pool by the estimated activity base for that pool.C. dividing the actual cost for each activity pool by the estimated activity base for that pool.D. dividing the cost budgeted for each activity pool by the actual activity base in that pool.
84. Shubelik Company is changing to an activity-based costing method. They have determined that they will use three cost pools. They are setups, inspections, and assembly. Which of the following would be used as the activity base for assembly? A. number of direct labor hoursB. number of setupsC. number of inspectionsD. number of units to be produced
85. Given the following information, determine the activity rate for setups.
Activity Pool
Activity Base
Budgeted Amount
Setups
10,000
$60,000
Inspections
24,000
$120,000
Assembly (DLH)
80,000
$400,000
A. $58.00B. $6.00C. $.75D. $5.09
86. The Skagit Company manufactures Hooks and Nooks. The following shows the activities per product and total activity information:
Setups
Inspections
Assembly (DLH)
Hooks – 4,000 units
1
4
1
Nooks – 8,000 units
2
1
3
Activity Pool
Activity Base
Budgeted Amount
Setups
20,000
$ 60,000
Inspections
24,000
120,000
Assembly (DLH)
28,000
420,000
Calculate the total factory overhead to be charged to each unit of Hooks. A. $38.00B. $50.00C. $16.67D. $23.00
87. The Skagit Company manufactures Hooks and Nooks. The following shows the activities per product and total activity information:
Setups
Inspections
Assembly (DLH)
Hooks – 4,000 units
1
4
1
Nooks – 8,000 units
2
1
3
Activity Pool
Activity Base
Budgeted Amount
Setups
20,000
$ 60,000
Inspections
24,000
120,000
Assembly (DLH)
28,000
420,000
Calculate the total factory overhead to be charged to Nooks. A. $300,000B. $400,000C. $448,000D. $560,000
88. The Dawson Company manufactures small lamps and desk lamps. The following shows the activities per product and the total overhead information:
Setups
Inspections
Assembly (DLH)
Small Lamps – 3,000 units
8,000
9,000
16,000
Desk Lamps – 6,000 units
16,000
15,000
12,000
Activity Pool
Activity Base
Budgeted Amount
Setups
24,000
$60,000
Inspections
24,000
$120,000
Assembly (DLH)
28,000
$280,000
Calculate the total factory overhead to be charged to desk lamps. A. $306,667B. $235,000C. $230,000D. $225,000
89. The Dawson Company manufactures small lamps and desk lamps. The following shows the activities per product and the total overhead information:
Setups
Inspections
Assembly (DLH)
Small Lamps – 3,000 units
8,000
9,000
16,000
Desk Lamps – 6,000 units
16,000
15,000
12,000
Activity Pool
Activity Base
Budgeted Amount
Setups
24,000
$60,000
Inspections
24,000
$120,000
Assembly (DLH)
28,000
$280,000
Calculate the overhead per unit to be charged to small lamps. A. $75.00B. $39.17C. $38.33D. $17.50
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