Greenwood Company manufactures two products—14,000 units of Product Y and 6,000 units of Product Z. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates all of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products Y and Z:
Activity Cost Pool Activity Measure Estimated Overhead Cost Expected Activity
Machining Machine-hours $ 209,000 10,000 MHs
Machine setups Number of setups $ 171,100 290 setups
Production design Number of products $ 93,000 2 products
General factory Direct labor-hours $ 259,000 10,000 DLHs
Activity Measure Product Y Product Z
Machining 7,900 2,100
Number of setups 50 240
Number of products 1 1
Direct labor-hours 8,900 1,100
1. What is the company’s plantwide overhead rate? (Round your answer to 2 decimal places.) Predetermined overhead rate? per DLH $
2.
Using the plantwide overhead rate, how much manufacturing overhead cost is allocated to Product Y and Product Z? (Round your intermediate calculations to 2 decimal places and final answers to the nearest dollar amount.)
Manufacturing overhead allocated? (Product Y) $ (Product Z) $
3.
What is the activity rate for the Machining activity cost pool? (Round your answer to 2 decimal places.)
Activity rate? per MH
4.
What is the activity rate for the Machine Setups activity cost pool? (Round your answer to 2 decimal places.)
Activity rate? per setup
5.
What is the activity rate for the Product Design activity cost pool? (Round your answer to 2 decimal places.)
Activity rate? per product
6.
What is the activity rate for the General Factory activity cost pool? (Round your answer to 2 decimal places.)
Activity rate? per DLH
7. Which of the four activities is a batch-level activity?
Machining activity
General factory activity
Product design activity
Machine setups activity
8. Which of the four activities is a product-level activity?
Machining activity
Machine setups activity
Product design activity
General factory activity
9.
Using the ABC system, how much total manufacturing overhead cost would be assigned to Product Y? (Round your intermediate calculations to 2 decimal places and final answer to the nearest dollar amount.)
Total manufacturing overhead cost?
10.
Using the ABC system, how much total manufacturing overhead cost would be assigned to Product Z? (Round your intermediate calculations to 2 decimal places and final answer to the nearest dollar amount.)
Total manufacturing overhead cost?
11.
Using the plantwide overhead rate, what percentage of the total overhead cost is allocated to Product Y and Product Z? (Round your answers to 2 decimal places.)
Total overhead cost? Product Y %: Product Z%:
12.
Using the ABC system, what percentage of the Machining costs is assigned to Product Y and Product Z? (Round your answers to 2 decimal places.)
Machining cost? Product Y%: Product Z%:
13.
Using the ABC system, what percentage of Machine Setups cost is assigned to Product Y and Product Z? (Round your answers to 2 decimal places.)
Machine setups cost? Product Y: %
Product Z: %
14.
Using the ABC system, what percentage of the Product Design cost is assigned to Product Y and Product Z? (Round your answers to 2 decimal places.)
Product design cost? Product Y: %
Product Z: %
15.
Using the ABC system, what percentage of the General Factory cost is assigned to Product Y and Product Z? (Round your answers to 2 decimal places.)
General Factory cost? Product Y: %
Product Z: %
Answers: 3
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Greenwood Company manufactures two products—14,000 units of Product Y and 6,000 units of Product Z....
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