Rocky Mountain Corporation makes two types of hiking boots—Xactive and Pathbreak

Question

Rocky Mountain Corporation makes two types of hiking boots—Xactive and Pathbreaker. Data concerning these two product lines appear below:

Rocky Mountain Corporation makes two types of hiking boots- Xactive and Pathbreaker. Data concerning these two product lines appear below Direct materials per unit Direct labor cost per unit Direct labor-hours per unit Estimated annual production and sales Xactive S 64.60 S 18.00 S 50.80 12.80 1.4 DLHs 1 DLHs 23,000 units73,000 units The company has a conventional 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 Estimated total manufacturing overhead Estimated total direct labor-hours $2,082,960 105,200 DLHs Required 1-a. Compute the predetermined overhead rate based on direct labor-hours. (Round the intermediate calculations and final answer to two decimal places.) termined overhead rate$19.80 per DLH 1-b. Using the predetermined overhead rate and other data from the problem, determine the unit product cost of each product. (Round the intermediate calculations and final answer to two decimal places.) Xactive Unit product cost 2. The company is considering replacing its conventional costing system with an activity-based costing system that would assign its manufacturing overhead to the following four activity cost pools: Expected Activity Estimated Activity Cost Pools and Activity Measures Supporting direct labor (direct labor-hours) Batch setups (setups) Product sustaining (number of products) General factory (machine-hours) Overhead Cost Xactive Pathbreaker Total 752,180 32,200 73,000 105,200 380 608,000 654,140 240 140 68,640 2,300 7,300 9,600 Total manufacturing overhead cost $2,082,960 Determine the activity rate for each of the four activity cost pools. (Round your final answers to 2 decimal places.) Activity Cost Pools Activity Rate Supporting direct labor Batch setups Product sustaining General factory per DLH per setup per product per MH 3. Using the activity rates and other data from the problem, determine the unit product cost of each product. (Round the intermediate calculations and final answer to two decimal places.) Xactive Unit product cost

Explanation / Answer

1-a. Predetermined overhead rate = $2082960/105200 = $19.80 per DLH

1-b.

2.

3.

Xactive Pathbreaker Direct materials 64.60 50.80 Direct labor 18.00 12.80 Manufacturing overhead 27.72 19.8 (1.4 x $19.80) (1 x $19.80) Unit product cost $ 110.32 83.40

Related Questions

Navigate

• Browse (All)
• Browse R
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.