Determine the hierarchy level for each cost pool
Course:- Managerial Accounting
Reference No.:- EM13487322

Assignment Help
Expertsmind Rated 4.9 / 5 based on 47215 reviews.
Review Site
Assignment Help >> Managerial Accounting

After a study of its processes, a firm determines it has the following 4 overhead cost pools related to the production of its 2 products: Set-up, Shipping, Product design, and Plant utilities and administration.

Both products are produced in the same facility using the same equipment. Product XYZ is a higher volume product that takes a relatively small amount of machine-time to produce, while Product ABC is a lower volume product that takes a significantly higher amount of machine-time. Also, Product XYZ requires very little set-up time, while Product ABC requires a more time-consuming set-up. Both products are shipped in a similar way, with each shipment requiring a similar amount of work.

Based on this information, determine the hierarchy level for each cost pool and an appropriate allocation base for each pool.


Cost Pool

Hierarchy Level

Allocation Base









Product design




Plant utilities & administration





Put your comment

Ask Question & Get Answers from Experts
Browse some more (Managerial Accounting) Materials
Journalize these transactions in a two-column journal. Post the entries prepared in (A) to the following T accounts: Cash, Supplies, Accounts Receivable, Accounts Payable, Fee
Beta Company produces two products, A and B, each of which uses materials X and Y. The following unit standard costs apply: Calculate the material price and usage variances fo
Determine the appropriate allocation of service department costs to the teaching departments, taking into account the reciprocal nature of service provision between departme
What steps can be taken to loosen the constraint in coating and sharpening and consider Model C210 and Model D400 chisels. Which product should be emphasized if the constraint
Estilo Company has 3 operating segments with following information: What is the minimum amount of revenue that each of these segments must generate to be considered separately
Describe the method of least squares. Why is this method better than either the high-low method or the scattergraph method? What is meant by the best-fitting line?
How a Pareto Superior allocation can be achieved that will help some people without hurting others. Make sure you define efficiency and Pareto Superiority.
GHI Company makes light-weight canoes for campers. The president, George Ingalls, enlists your help in predicting the effects of some changes he is contemplating. He gives y