Smoky Mountain Corporation makes two types of hiking boots—Xtreme and the Pathfi
ID: 2470950 • Letter: S
Question
Smoky Mountain Corporation makes two types of hiking boots—Xtreme and the Pathfinder. Data concerning these two product lines appear below:
The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below:
Expected Activity
Prepare a quantitative comparison of the traditional and activity-based cost assignments. (Do not round intermediate calculations. Round your "Percentage" answer to 1 decimal place. (i.e. .1234 should be entered as 12.3))
Smoky Mountain Corporation makes two types of hiking boots—Xtreme and the Pathfinder. Data concerning these two product lines appear below:
Explanation / Answer
3)
The quantitative comparison of traditional and ABC costing is as follows:
Xtreme
Path finder
Particulars
Amount
%
Amount
%
Traditional cost system
Direct material
1,550,400
75.36
3,710,000
76.81
Direct labor
230,400
11.20
560,000
11.59
Manufacturing overhead
276,480
13.44
560,000
11.59
2,057,280
100
4,830,000
100
Activity based costing
Direct costs
Direct material
1,550,400
53.22
3,710,000
67.03
Direct labor
230,400
7.91
560,000
10.12
Indirect costs
Supporting direct labor
187,200
6.43
455,000
8.22
Batch set ups
525,000
18.02
390,000
7.05
Product sustaining
420,000
14.42
420,000
7.59
Total
2,913,000
100
5,535,000
100
Xtreme
Path finder
Particulars
Amount
%
Amount
%
Traditional cost system
Direct material
1,550,400
75.36
3,710,000
76.81
Direct labor
230,400
11.20
560,000
11.59
Manufacturing overhead
276,480
13.44
560,000
11.59
2,057,280
100
4,830,000
100
Activity based costing
Direct costs
Direct material
1,550,400
53.22
3,710,000
67.03
Direct labor
230,400
7.91
560,000
10.12
Indirect costs
Supporting direct labor
187,200
6.43
455,000
8.22
Batch set ups
525,000
18.02
390,000
7.05
Product sustaining
420,000
14.42
420,000
7.59
Total
2,913,000
100
5,535,000
100
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.