00 Sprint 3396 11:39 AM ezto.mheducation.com Sara\'s Salsa Company produces its

Question

00 Sprint 3396 11:39 AM ezto.mheducation.com Sara's Salsa Company produces its condiments in two types: Extra Fine for restaurant customers and Family Style for home use. Salsa is prepared in department 1 and packaged in department 2. The activities, overhead costs, and drivers associated with these two manufacturing processes and the company's production support activities follow. 2,500 2.500 500 6,100 Machine hours 0.900 Machine hours 114.100 Batches Product testing $ 131,100 S 330000 Production runs 6500 Cases of output 000 Cases of output 600 170000 170000 Defects 355.s00 Support 85,000 Focus groups Recipe formulation Heat, lights, and water Materials handling 3.000 Machine hours 81000 Container types 85 2.500 10 s 209.000 Additional production information about its two product lines follows. Units produced 36,000 cases 134,000 cases 360 batches 140 batches Machine hours Focus groups Container types Production runs 1050 MH 1450 MH 60 groups 25 group 8 containers 270 runs 330 runs

Explanation / Answer

= 131100+355500+209000

= 695600

Total cases = Extra fine + Family style

= 36000+134000

= 170000

Cost assigned to Extra fine = 695600*(36000/170000)

= 147303.53

Cost assigned to Family style = 695600*(134000/170000)

= 548296.47

Cost assigned to Extra fine (Per unit) = 147303.53/36000

= 4.09

Cost assigned to Family style (Per unit) = 548296.47/134000

= 4.09

Extra fine = 8+4.09

= 12.09

Family style = 7+4.09

= 11.09

Extra fine = 16 – 12.09

Family style = 16 – 11.09

                      

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