Reference no: EM132852963
Question 1 - Casual Cuts Inc. has total estimated factory overhead for the year of $225,000, divided into four activities: cutting, $90,000; sewing, $22,500; setup, $80,000; and inspection, $32,500. Casual Cuts manufactures two types of men's pants: jeans and khakis. The activity-base usage quantities for each product by each activity are as follows:
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Cutting
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Sewing
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Setup
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Inspection
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|
Jeans
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500 dlh
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1,000 dlh
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250 setups
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100 inspections
|
|
Khakis
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1,000
|
500
|
750
|
400
|
|
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1,500 dlh
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1,500 dlh
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1,000 setups
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500 inspections
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Each product is budgeted for 10,000 units of production for the year.
Required -
a. Determine the activity rates for each activity.
b. Determine the factory overhead cost per unit for each product, using activity-based costing. Round your answers to two decimal places.
Question 2 - Maritime Marine Company has total estimated factory overhead for the year of $1,033,400, divided into four activities: fabrication, $406,400; assembly, $165,000; setup, $132,000; and inspection, $330,000. Maritime manufactures two types of boats: a speedboat and a bass boat. The activity-base usage quantities for each product by each activity are as follows:
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Fabrication
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Assembly
|
Setup
|
Inspection
|
|
Speedboat
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900 dlh
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1,400 dlh
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60 setups
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100 inspections
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|
Bass boat
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2,300
|
1,100
|
90
|
500
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|
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3,200 dlh
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2,500 dlh
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150 setups
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600 inspections
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Each product is budgeted for 200 units of production for the year.
Required -
a. Determine the activity rates for each activity.
b. Determine the factory overhead cost per unit for each product, using activity-based costing. If required, round to the nearest cent.