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gslwong gslwong
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7 months ago
A firm produces and sells two products, Standard and Deluxe. The following information relates to setup costs of $180,000 (a part of factory overhead).

StandardDeluxe
Units produced1,6001,600
Number of setups100125
Direct labor hours per unit99
Total direct labor costs$9,000$9,000

Activity-based costing will allocate which of the following amounts of setup cost to each unit (rounded to the nearest dollar)?
StandardDeluxe


$56$56


5063


356444


126101
Textbook 
Managerial Accounting

Managerial Accounting


Edition: 4th
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lyssa1605lyssa1605
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7 months ago
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5063


Units per setup for Standard: 1,600 ÷ 100 = 16; Units per setup for Deluxe: 1,600 ÷ 125 = 12.8;
$180,000 ÷ (100 + 125) = $800 per setup;
Standard setup cost per unit = $800 ÷ 16 = $50;
Deluxe setup cost per unit = $800 ÷ 12.8 = $62.50 (rounded to nearest dollar is $63.00)
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gslwong Author
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7 months ago
Good timing, thanks!
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Yesterday
Thanks
wrote...

2 hours ago
Thanks for your help!!
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