thedoragreen

05.03.2021 • 

Business

Concord Company produces two products: MB-R and MB-X. Currently, Concord allocates overhead based on direct labour hours. Overhead is estimated at $366,400. The cost accountant realizes that there are some differences in how resources are being used in producing these two components and is considering the use of ABC to allocate overhead. She determines that overhead is caused by testing and inspections, $72,000; machine setup, $84,000; machine stamping, $160,000; and plant maintenance, $50,400. Concord estimates the following activities related to the overhead costs: Activity Cost Driver MB-R MB-X
Testing and inspections Number of testing and inspections 400 400
Machine setup Number of setups 140 60
Machine stamping Number of machine hours 25,000 15,000
Plant maintenance Direct labour hours 1,200 2,200

Required:
Use ABC cost hierarchy to classify each activity.

Ответ:

alexmiranda00

10.12.2020

Business

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$11,000

Explanation:

Depreciation expense in year 1 = 0.33 x $50,000 = $16,500

Depreciation expense in year 2 = 0.45 x $50,000 = $22,500

Book value in year 2 = cost of asset - accumulated depreciation

$50,000 - ( $16,500 + $22,500) = $11,000

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