Problem 4-1A Combat Fire, Inc. manufactures steel cylinders and nozzles for two models of fire extinguishers: (1) a home fire extinguisher and (2) a commercial fire extinguisher. The home model is a high-volume (54,000 units), half-gallon cylinder that holds 2 1/2 pounds of multi-purpose dry chemical at 480 PSI. The commercial model is a low-volume (10,200 units), two-gallon cylinder that holds 10 pounds of multi-purpose dry chemical at 390 PSI. Both products require 1.5 hours of direct labor for completion. Therefore, total annual direct labor hours are 96,300 or [1.5 hours × (54,000 + 10,200)]. Expected annual manufacturing overhead is $1,567,900. Thus, the predetermined overhead rate is $16.28 or ($1,567,900 ÷ 96,300) per direct labor hour. The direct materials cost per unit is $18.50 for the home model and $26.50 for the commercial model. The direct labor cost is $19 per unit for both the home and the commercial models.
The company's managers identified six activity cost pools and related cost drivers and accumulated overhead by cost pool as follows.
Expected Use of
Drivers by Product
|
| Activity Cost Pools |
Cost Drivers |
Estimated Overhead |
Expected Use of
Cost Drivers
|
Home |
Commercial |
| Receiving |
Pounds |
$85,400 |
335,000 |
215,000 |
120,000 |
| Forming |
Machine hours |
155,000 |
35,000 |
27,000 |
8,000 |
| Assembling |
Number of parts |
403,000 |
217,000 |
165,000 |
52,000 |
| Testing |
Number of tests |
45,000 |
25,500 |
15,500 |
10,000 |
| Painting |
Gallons |
55,500 |
5,258 |
3,680 |
1,578 |
| Packing and shipping |
Pounds |
824,000 |
335,000 |
215,000 |
120,000 |
| $1,567,900 |
Under traditional product costing, compute the total unit cost of each product. (Round answers to 2 decimal places, e.g. 12.50.)
Under ABC, prepare a schedule showing the computations of the activity-based overhead rates (per cost driver). (Round overhead rate to 2 decimal places, e.g. 12.25.)
Prepare a schedule assigning each activity's overhead cost pool to each product based on the use of cost drivers. (Round overhead cost per unit to 2 decimal places, e.g. 12.25 and cost assigned to 0 decimal places, e.g. 2,500.)
Compute the total cost per unit for each product under ABC. (Round answer to 2 decimal places, e.g. 12.25.)
let me know how to calculate and what numbers to add/subtract/divide to get the answers to the blanks above