All necessary calculations are on the attached excel sheet

QUESTION 6: Sala Corporation uses the weighted-average method in its process costing system. The Fitting Department is the second department in its production process. The data below summarize the department's operations in March.

Beginning work in process inventory Transferred in from the prior department during March Ending work in process inventory

Units 9,500 45,000 3,700

Percent Complete with Respect to Conversion 30%

80%

The Fitting Department's cost per equivalent unit for conversion cost for March was $2.44. How much conversion cost was assigned to the units transferred out of the Fitting Department during March?
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$131,174. 4 $109,800 $123,952 $132,980

Units in Beginning Inventory Add: Units Started into Production Less: Units in Ending Inventory Units Transferred Out Cost per Equivalent Unit Conversion Cost Assigned to Units Transferred Out

9,500 45,000 3,700 50,800 $2.44 $123,952

QUESTION 7: Sumter Company uses the weighted-average method in its process costing system. The following data pertain to operations in the first processing department for a recent month:

Work in process, beginning: Units in process Percent complete with respect to materials Percent complete with respect to conversion Costs in the beginning inventory: Materials cost Conversion cost Units started during the month Units completed and transferred out during the month Costs added to production during the month:

5,900 70% 30% $76,400 $2,900 ? 70,200

Materials cost Conversion cost Work in process, ending: Units in process Percent complete with respect to materials Percent complete with respect to conversion
How many units were started into production during the month?
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$293,968 $198,524 8,700 80% 35%

55,600 units 67,400 units 84,800 units 73,000 units

QUESTION 9: Cooperative San Jos of southern Sonora state in Mexico makes a unique syrup using cane sugar and local herbs. The syrup is sold in small bottles and is prized as a flavoring for drinks and for use in desserts. The bottles are sold for $12 each. (The Mexican currency is the peso and is denoted by $.) The first stage in the production process is carried out in the Mixing Department, which removes foreign matter from the raw materials and mixes them in the proper proportions in large vats. The company uses the weighted-average method in its process costing system. A hastily prepared report for the Mixing Department for April appears below: Units to be accounted for: Work in process, April 1 (materials 90% complete; conversion 80% complete) Started into production Total units to be accounted for Units accounted for as follows: Transferred to next department Work in process, April 30 (materials 75% complete; conversion 50% complete) Total units accounted for Cost Reconciliation Cost to be accounted for: Work in process, April 1 Cost added during the month Total cost to be accounted for Cost accounted for as follows: Work in process, April 30 Transferred to next department Total cost accounted for

6,000 34,000 40,000 24,000 16,000 40,000

$16,100 84,800 $100,900 7,800 $93,100 $100,900

Management would like some additional information about Cooperative San Jos's operations. Requirement 1: What were the equivalent units for the month? Materials Equivalent units of production Conversion

36,000 , and 32,000

Quantities Units to be accounted for Work in Process, Beginning Started into Production Total Units Units Accounted for Transferred Out WIP, Ending Total Units

Physical Units

Equivalent Units Materials Conversion

6,000 34,000 40,000 24,000 16,000 40,000 24,000 12,000 36,000 24,000 8,000 32,000

Requirement 2: What were the costs per equivalent unit for the month? The beginning inventory consisted of the following costs: materials, $11,000 and conversion cost, $5,100. The costs added during the month consisted of: materials, $52,000; and conversion cost, $32,800. (Round your answers to 2 decimal places. Omit the "$" sign in your response) Materials Cost per equivalent unit $ Conversion $

$1.75 , $1.18 Cost per Equivalent Unit Unit Costs WIP Costs in Month Total Cost Equivalent Units Unit Costs
Requirement 3:

Material 11,000 52,000 63,000 36,000 1.75

Conversion 5,100 32,800 37,900 32,000 1.18

Total 16,100 84,800 100,900

2.93

How many of the units transferred to the next department were started and completed during the month? Units started and completed during April

Started and completed = 18,000

Requirement 4: The manager of the Mixing Department stated, "Materials prices jumped from about $1.50 per unit in March to $3.00 per unit in April, but due to good cost control I was able to hold our materials cost to less than $3.00 per unit for the month." Should this manager be rewarded for good cost control?

No. The manager should not be rewarded. In weighted average method, the costs of prior period get mixed with the costs of current period. Thus if cost is March is $1.50 and in April it is $3.00, the average cost would be less than $3.00 in the weighted average method.
QUESTION 10: Testing a prototype of a new product is an example of a:
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Unit-level activity. Product-level activity. Organization-sustaining activity. Batch-level activity.

QUESTION 11: Kraska Corporation has provided the following data from its activity-based costing system: Activity Cost Pool Assembly Processing orders Inspection Total Cost $455,000 $33,740 $108,348 Total Activity 36,000 machine-hours 960 orders 1,320 inspection-hours

Data concerning one of the companys products, Product O11W, appear below: Selling price per unit Direct materials cost per unit Direct labor cost per unit Annual unit production and sales Annual machine-hours Annual orders Annual inspection-hours $96.0 $16.8 $13.0 370.0 880.0 85.0 22.0

According to the activity-based costing system, the product margin for product O11W is (round activity rates to 2 decimal places):
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$6,798.43 $1,428.00

$8,578.58 $4,810.00

QUESTION 12: Kassabian Corporation uses an activity-based costing system with three activity cost pools. The company has provided the following data concerning its costs and its activity based costing system: Costs: Wages and salaries Depreciation Utilities Total Distribution of resource consumption: Activity Cost Pools Assembly Wages and salaries Depreciation Utilities 50% 20% 25% Setting Up 30% 40% 35% Other 20% 40% 40% Total 100% 100% 100% $500,000 226,000 235,000 $961,000

How much cost, in total, would be allocated in the first-stage allocation to the Assembly activity cost pool?
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$384,400 $250,000 $115,250 $353,950

Total Assembly Cost: Wages and Salaries: 50% $500,000 Depreciation: 20% $226,000 Utilities: 25% $235,000 Total $250,000 $45,200 $58,750 $353,950

QUSTION 13: Worker recreational facilities is an example of a cost that would ordinarily be considered to be: Organization-sustaining. Unit-level. Batch-level.

Product-level. QUESTION 14: Grodin Catering uses activity-based costing for its overhead costs. The company has provided the following data concerning the activity rates in its activity-based costing system: Activity Cost Pools Preparing Arranging Meals Functions $2.5 $310 $1.25 $230 $1.25 $210

Wages Supplies Other expenses

The number of meals served is the measure of activity for the Preparing Meals activity cost pool. The number of functions catered is used as the activity measure for the Arranging Functions activity cost pool. Management would like to know whether the company made any money on a recent function at which 360 meals were served. The company catered the function for a fixed price of $33 per meal. The cost of the raw ingredients for the meals was $18.65 per meal. This cost is in addition to the costs of wages, supplies, and other expenses detailed above. For the purposes of preparing action analyses, management has assigned ease of adjustment codes to the costs as follows: wages are classified as a Yellow cost; supplies and raw ingredients as a Green cost; and other expenses as a Red cost. Suppose an action analysis report is prepared for the function mentioned above. What would be the "red margin" in the action analysis report? (Round to the nearest whole dollar.)
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$2,466 $2,766 $2,516 $2,616

Sales (360 $33) Green Costs: Supplies & Raw Ingredients (360 $19.90) + $230 Green Margin Yellow Cost: Wages (360 $2.5) + $310 Yellow Margin Red Costs: Other Expenses (360 $1.25) + $210 Red Margin
QUESTION 15: If a cost object such as a product or customer has a positive green margin, then:
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$11,880 $7,394 $4,486 $1,210 $3,276 $660 $2,616

its red margin may be either positive, negative, or zero. its red margin will be zero. its red margin will be positive. its red margin will be negative.

QUESTION 16: Fordham Florist specializes in large floral bouquets for hotels and other commercial spaces. The company has provided the following data concerning its annual overhead costs and its activity based costing system: Overhead costs: Wages and salaries Other expenses Total Distribution of resource consumption: Activity Cost Pools Making Bouquets Wages and salaries Other expenses 70% 45% Delivery 20% 25% Other 10% 30% Total 100% 100% $ 105,000 45,000 $150,000

The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs. The amount of activity for the year is as follows: Activity Cost Pool Activity Making bouquets Delivery 29,000 bouquets 3,600 deliveries

What would be the total overhead cost per delivery according to the activity based costing system? In other words, what would be the overall activity rate for the "Deliveries" activity cost pool? (Round your answer to 2 decimal places.)
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$2.92 $5.83 $8.96 $4.02

Delivery Cost: Wages and salaries: 20% $105,000..................... Other expenses: 25% $45,000............................. Total........................................................................ Activity Cost Pool Delivery (a) Total Cost $32,250 (b) Total Activity 3,600 deliveries

$21,000 11,250 $32,250 (a) (b) Activity Rate $8.96 per delivery

QUESTION 17: Smoky Mountain Corporation makes two types of hiking bootsXtreme and the Pathfinder. Data concerning these two product

lines appear below: Selling price per unit Direct materials per unit Direct labor per unit Direct labor-hours per unit Estimated annual production Xtreme $144 $65 $20 2 DLHs 11,000 units Pathfinder $106 $40 $20 2 DLHs 61,000 units

The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below: Estimated total manufacturing overhead Estimated total direct labor-hours $2,260,800 144,000 DLHs

Requirement 1: (a) Calculate the predetermined overhead rate. (Round your answer to 2 decimal places. Omit the "$" sign in your response.) Predetermined overhead rate $

$2, 260,800 =$15.7 144, 000

(b) Compute the product margins for the Xtreme and the Pathfinder products under the company's traditional costing system. (Negative amount should be indicated by a minus sign. Round predetermined overhead rate to 2 decimal places. Round your answers to the nearest dollar amount. Omit the "$" sign in your response.) Xtreme Product margin $ Pathfinder $ Total $

Requirement 2: The company is considering replacing its traditional costing system with an activity-based costing system that would assign its manufacturing overhead to the following four activity cost pools (the Other cost pool includes organization-sustaining costs and idle capacity costs): Expected Activity Activities and Activity Measures Supporting direct labor (direct labor-hours) Batch setups (setups) Product sustaining (number of products) Other Total manufacturing overhead cost Estimated Overhead cost $796,320 486,300 602,100 376,080 $2,260,800 Xtreme 22,000 150 1 NA Pathfinder 122,000 150 1 NA Total 144,000 300 2 NA

Compute the product margins for the Xtreme and the Pathfinder products under the activity-based costing system. (Negative amount should be indicated by a minus sign. Omit the "$" sign in your response.) Xtreme Product margin $ Pathfinder $ Total $

Requirement 3: Prepare a quantitative comparison of the traditional and activity-based cost assignments. (Round your percentage values to one decimal place and round all other values to the nearest whole number. Omit the "$" & "%" signs in your response.)

Xtreme Traditional Cost System Direct materials Direct labor Manufacturing overhead Total cost assigned to products Activity-Based Costing System Direct costs: Direct materials Direct labor Indirect costs: Supporting direct labor Batch setups Product sustaining Total cost assigned to products Costs not assigned to products: Other Total cost $ % % % $ $ % % $ $ Amount $ % % % % $ $

Pathfinder % % % %

Total Amount $

% % % % %

QUESTION 18: Ellix Company manufactures two models of ultra-high fidelity speakers, the X200 model and the X99 model. Data regarding the two products follow: Product X200 X99 Direct labor hours .3 DLHs per unit .5 DLHs per unit Annual production 22,000 Units 38,000 Units Total Direct Labor Hours 6,600 DLHs 11,400 DLHs 25,600 DLHs

Additional information about the company follows: a. Model X200 requires $33 in direct materials per unit, and model X99 requires $27. b. The direct labor rate is $60 per hour. c. The company has always used direct labor-hours as the base for applying manufacturing overhead cost to products. d. Model X200 is more complex to manufacture than model X99 and requires the use of a special equipment. e. Because of the special work required in (d) above, the company is considering the use of activity based costing to apply manufacturing overhead cost to products. Three activity cost pools have been identified as follows: Estimated Total Activity Activity Cost Pool Machine setups Special processing General factory Activity Measure Number of setups Machine-hours Direct labor-hours Estimated Total Cost $154,100 403,300 510,000 $1,067,400 X200 138 1,090 3,400 X99 92 0 13,600 Total 230 1,090 17,000

Requirement 1: Assume that the company continues to use direct labor-hours as the base for applying overhead cost to products. (a) Compute the predetermined overhead rate. (Round your answer to the nearest dollar amount. Omit the "$" sign in your response.)

Predetermined overhead rate

per DLH

(b) Compute the unit product cost of each model. (Round your answers to 2 decimal places. Omit the "$" sign in your response.) Model X200 Unit product Cost $ X99 $

Requirement 2: Assume that the company decides to use activity-based costing to apply overhead cost to products. (a) Compute the activity rate for each activity cost pool and determine the amount of overhead cost that would be applied to each model. (Leave no cells blank - be certain to enter "0" wherever required. Round the Overhead cost per unit to 2 decimal places. Omit the "$" sign in your response.) Activity cost Pool Machine setups Special processing General factory Model X200: Activity Cost Pool Machine setups Special processing General factory Total manufacturing overhead cost Overhead cost per unit Model X99 Activity Cost Pool Machine setups Special processing General factory Total manufacturing overhead cost Overhead cost per unit $ $ Overhead Applied $ $ $ Overhead Applied $ $ $ $ Activity Rate Per setup Per MH Per DLH

(b) Compute the unit product cost of each model. (Round your answers to 2 decimal places. Omit the "$" sign in your response.) Unit product cost of Model X200 Unit product cost of Model X99 $ $