Traditional and Activity Based Costing Methods
Not what you're looking for?
Electronic World Co. manufactures two types of radios, Model1 which is their high feature radio and Model2 their standard radio type. Below is the detailed production requirements for both types of radios.
Model 1 Model 2
Number of radios 1000 2000
Direct materials $20/unit $10/unit
Direct Labor Hrs at 10$/hr 4hrs 2hrs
Machine time 3hrs 2hrs
Production Runs 1 run of 1000 2 runs of 1000
The Manufacturing Overhead costs for Electronic World Co. is identified as $100,000, which is split across 2 activities.
Cost Cost Driver
Machine costs $70,000 Machine hours
Setup costs of $30,000 Production runs
Calculate the Total Cost of the products using:
a) Traditional costing method.
b) Activity based costing method.
Purchase this Solution
Solution Summary
This solution calculates the total cost of the products being used using traditional methods and activity based costing methods.
Solution Preview
Note: Please see the attached document for a more in-depth solution.
Calculate the Total Cost of the products using
a) The traditional costing method.
We will allocate the overheads as per labor hour in dollars ($)
Model 1 Model ...
Purchase this Solution
Free BrainMass Quizzes
SWOT
This quiz will test your understanding of the SWOT analysis, including terms, concepts, uses, advantages, and process.
Marketing Research and Forecasting
The following quiz will assess your ability to identify steps in the marketing research process. Understanding this information will provide fundamental knowledge related to marketing research.
Motivation
This tests some key elements of major motivation theories.
Operations Management
This quiz tests a student's knowledge about Operations Management
Basic Social Media Concepts
The quiz will test your knowledge on basic social media concepts.