Greenwood Company manufactures two products -14,000 units of Product Y and 6,000
ID: 2329580 • Letter: G
Question
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 information is available for the company as a whole and for Products Y and Z additional tivity Cost ActivityEstimated Pool Expected Measure Overhead Cost 206, 000 S 145, 600 S 90,000 Machine- hours Activity 10, 000 MHs Machining Machine setups ne setups Number of 260 setups Production design General factory Number of 2 products products Direct lab -hours 307,200 12,000 DILHS Activity MeasureProduct Y Product 2 Machining Number of setups Number of products Direct labor-hours 8, 600 50 1,400 210 8, 600 3,400 12. Using the ABC system, what percentage of the Machining costs is assigned to Product Y and Product Z? (Round your intermediate calculations to 2 decimal places. Round your answers to 2 decimal places.) Product YProduct Z Machining costExplanation / Answer
Calulation of rate per Machine Hours Estimated overhead cost Expected activity Acivity rate Machining Activity cost pool 206000 10,000 mhs $20.6 Per Mh Calulation of rate per Machine Hours Estimated overhead cost Expected activity Acivity rate Machining Activity cost pool 206000 10,000 mhs $20.6 Per Mh Product Y Product Z maching cost at $20.6 per Machine hours Expected Activity Amount Expected Activity Amount $ 8,600.00 $ 177,160.00 1400 $ 28,840.00 Product Y Product Z Activity Based costing System Estimated overhead cost Amount Percentage Amount Percentage Machining $ 206,000.00 $ 177,160.00 86% $ 28,840.00 14%
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