Chapter 5 practice problem 3 PDF

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ACC 405 Chapter 5 practice problem 3...

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Score:

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Points

100

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3.

Award: 0 out of 0 0..00 points

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North Company designs and manufactures machines that facilitate DNA sequencing. Depending on the intended purpose of each machine and its functions, each machine is likely to be unique. The job-order costing system in its Norfolk plant has five activity cost pools, in addition to direct materials and direct labor. Job TPY–2306 requires 1,000 printed-circuit boards. The cost per board that passes the final inspection is $240. On average, only 50% of the completed units pass the final inspection. The prime costs per completed board are direct materials $25 and direct labor $5. Required: Information pertaining to manufacturing overhead for printed-circuit boards follows: Fill in the missing amount. (Round your answers to 2 decimal places.)

Activity Cost Pool

Cost Driver

Axial insertion

Number of axial insertions

0.20

30.00

Hardware insertion

Number of hardware insertions

2.00

18.50

Hand load

Boothroyd time

7.10

Masking

Number of points masked

0.12

Final test

Test time

0.60

 References Worksheet

Learning Objective: 05-03 Determine product costs under both the volume-based method and the activitybased method and contrast the two.

$

Factory Overhead per Board

Unit of Cost Driver per Board

Activity Driver Rate

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

$ 

6.00



37.00

5.00

35.50

100.00

12.00

10.00

6.00

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North Company designs and manufactures machines that facilitate DNA sequencing. Depending on the intended purpose of each machine and its functions, each machine is likely to be unique. The job-order costing system in its Norfolk plant has five activity cost pools, in addition to direct materials and direct labor. Job TPY–2306 requires 1,000 printed-circuit boards. The cost per board that passes the final inspection is $240. On average, only 50% of the completed units pass the final inspection. The prime costs per completed board are direct materials $25 and direct labor $5. Required: Information pertaining to manufacturing overhead for printed-circuit boards follows: Fill in the missing amount. (Round your answers to 2 decimal places.)

Activity Cost Pool

Cost Driver

Activity Driver Rate $

Factory Overhead per Board

Unit of Cost Driver per Board $

Axial insertion

Number of axial insertions

0.20

30.00

Hardware insertion

Number of hardware insertions

2.00

18.50

37.00

Hand load

Boothroyd time

7.10

5.00

35.50

Masking

Number of points masked

0.12

100.00

12.00

Final test

Test time

0.60

10.00

6.00

 Explanation: Factory overhead per board: Axial insertion: $0.20 × $30 = $6.00 Masking: $0.12 × $100 = $12.00 Unit of cost driver per board: Hardware insertion: $37.00 ÷ $2 = 18.50 Activity driver rate: Hand load: $35.50 ÷ $5 = $7.10 Final test: $6.00 ÷ $10 = $.60

6.00

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