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This post addresses the Barnes Corporation cost exercise.

Barnes Corporation manufactures two models of office chairs, a standard and a deluxe model. The following activity and cost information has been compiled:
Product # of Setups # of Components # of Direct Labor Hours
Standard 22 8 375
Deluxe 28 12 225
Overhead Costs $20,000 $40,000

14. Assuming a traditional costing system applies the $60,000 of overhead costs based on direct labor hours. What is the total amount of overhead costs assigned to the standard model?

a $24,800
b $35,200
c $37,500
d $22,500

15. Assume a traditional costing system applies the $60,000 of overhead costs based on direct labor hours. What is the total amount of overhead costs assigned to the deluxe model?

a $24,800
b $35,2500
c $37,500
d $22,500

16. Number of setups and number of components are identified as activity cost drivers for overhead. Assuming an ABC system is used, what is the total amount of overhead costs assigned to the standard model?

a $24,800
b $35,200
c $37,500
d $22,500

17. Number of setups and number of components are indentified as activity cost drivers for overhead. Assuming an ABC system is used, what is the total amount of overhead costs assigned to the deluxe model?

a $24,800
b $35,200
c $37,500
d $22,500

Solution Preview

14. c $37,500

[$60,000 / (375 + 225)] 375 = $37,500

15. d ...

Solution Summary

This solution provides the correct answers and calculations to each question listed for the Barnes Corporation cost exercise.

$2.19