Greenspace, Inc., manufactures a line of products used in environmental quality
ID: 2483773 • Letter: G
Question
Greenspace, Inc., manufactures a line of products used in environmental quality testing. The company recently made substantial changes in its production facilities, including installing robotic assembly units. Management now wants to switch to activity-based costing. Relevant data for three of its water quality testing devices X, Y, and Z are as follows: Product X Y Z Number of parts 29 38 41 Direct labor hours 2 1 3 Robot hours 1 1 1 Costs: Direct materials $325 $270 $400 Direct labor ($20/hour) The following information is available regarding budgeted overhead costs and bases that will be used for ABC costing: Activities Material Robotic All other Budgeted overhead $600,000 $800,000 $500,000 Bases 40,000 5,000 20,000 (parts) (robot hours) (labor hours) Required: Create an Excel spreadsheet that computes the total product costs for X, Y, and Z under ABC.Explanation / Answer
total product cost under ABC X Y Z cost per driver unit direct material 325 270 400 direct labor 40 20 60 total per unit 365 290 460 unit 29 38 41 total 10585 11020 18860 material 435 570 615 15 robotic 160 160 160 160 other 50 25 75 25 total cost under ABC 11230 11775 19710
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