Reference no: EM132590591

XYZ Manufacturing has identified two major activities, set ups and equipment maintenance. The following are estimated annual cost for each activity and expected quantity of the cost drivers for next year:

Overhead Item         Expected Cost                  Cost Drivers                   Expected Quantity

Setup costs                 RM 960,000               Number of setups               4,800 set ups

Maintenance              RM 640,000                  Machine hours                     64,000 Mhrs

The following is one of the jobs that XYZ Manufacturing is planning to work on nest year:

Job X

Direst material RM 10,000

Direct Labor RM 15,000

Units completed 650 units

Direct labor hours 180 DLHrs.

Number of setups 12 setups

Machine hours 360 MHrs.

Question A. Using traditional method and direct labor hours as cost driver , estimate the total costs to complete Job X. Next year XYZ Company expected 40,000 direct labor hours were needed.

Question B. Calculate Job X total costs using activity based costing method