1 precision lens company manufactures sophisticated lenses

Assignment Help Managerial Accounting

Reference no: EM13379599

1) Precision Lens Company manufactures sophisticated lenses and mirrors used in large optical telescopes. The company is now preparing its annual profit plan. As part of its analysis of the profitability of individual products, the controllable estimates the amount of overhead that should be allocated to the individual product lines from the following information.

	Mirrors	Lenses
Units produced	30	30
Material moves per product line	4	16
Direct-labor hours per unit	250	250

The total budgeted material handling cost for the year is $90,000.

Required:

a. Under a costing system that allocates overhead on the basis of direct-labor hours, the material handling costs allocated to one mirror would be what amount?

b. Answer the same question as in requirement (1), but for lenses.

c. Under activity-based costing (ABC), the material-handling costs allocated to one mirror would be what amount? The cost driver for the material handling activity is the number of material moves.

d. Answer the same question as in requirement (c) above, but for one lens instead of one mirror.

e. Why is the cost allocated in (c) & (d) differ from cost allocated in (a) & (b)?

Reference no: EM13379599

Questions Cloud

Cleveland metals uses a job cost system and applies factory : cleveland metals uses a job cost system and applies factory overhead to production at a predetermined rate of 180 of

1 analyze a publicly traded companys financial statements : 1 analyze a publicly traded companys financial statements for the prior five years. include the following items as

1 readersnetcom sells books and software over the internet : 1 readersnet.com sells books and software over the internet. a recent article in a trade journal has caught the

Clark ampschiffer llp perform activities related to : clark ampschiffer llp perform activities related to e-commerce consulting and information systems in vancouver british

1 precision lens company manufactures sophisticated lenses : 1 precision lens company manufactures sophisticated lenses and mirrors used in large optical telescopes. the company is

Manufacturing budget analysistom emory and jim morris : manufacturing budget analysistom emory and jim morris strolled back to their plant from the administrative offices of

Tax law complexity - tax law is determined by congress not : tax law complexity - tax law is determined by congress not the irs. the irs only enforces the law congress makes.

The city of shipley maintains an employee retirement fund a : the city of shipley maintains an employee retirement fund a single-employer defined benefit plan that provides annuity

Springfield express is a luxury passenger carrier in texas : springfield express is a luxury passenger carrier in texas. all seats are first class and the following data are

User Account

All Pages