Reference no: EM132509587
Bird's Eye View manufactures three different sizes of bird cages: small (for finches and canaries), medium (for cockatiels and small parrots), and large (for cockatoos and other large parrots). The company has recently implemented an activity-based costing system. Bird's Eye View has identified five different production activities as well as the best cost driver for each activity. Each activity and driver is listed below, along with the budgeted amount that is associated with each activity for next year.
Budgeted
Activity Cost Driver Costs
Materials handling Labor hours $ 55,000
Automated processing Machine hours 40,000
Plastic parts insertion Number of parts 6,000
Inspections Labor hours 29,000
Packaging Orders shipped 31,000
Total indirect manufacturing cost $161,000
- The following information relates to each size of bird cage and next year's anticipated manufacturing operations:
Large Medium Small
Units to be produced 350 400 600
Orders to be shipped 180 200 250
Number of parts per unit 8 6 4
Machine hours per unit 4 2 1
Labor hours per unit 2 2 2
Question 1: Under an activity-based costing system, what is the per unit cost for manufacturing overhead of a MEDIUM cage (rounded)?
$100
$136
$120
$151
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: Bird's Eye View manufactures, Under an activity-based costing system, what is the per unit cost for manufacturing overhead of a MEDIUM cage (rounded)?
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