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problem: VG Company has identified the following cost pools and cost drivers:

COST POOLS

ACTIVITY COST

COST DRIVERS

Machine Setup

$360,000

6000 setup hours

Materials Handling

$100,000

50,000 pounds of material

Electric Power

$40,000

80,000 kilowatt hours

The following information pertains to the production of V203 and G179:

ITEMS

V203

G179

Number of units produced

5,000

15,000

Direct Materials Cost

$25,000

$33000

Direct Labor Cost

$14,000

$16,000

Number of Setup Hours

120

150

Pounds of Material Used

5,000

10,000

Kilowatt Hours

2,000

3,000

find out the unit cost for every of the two products using activity based costing.

 

 

 

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M916125

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