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Category > Accounting Posted 18 Aug 2017 My Price 14.00

Salsa Company

SaraAc€?cs Salsa Company produces its condiments in two types: Extra Fine for restaurant customers and Family Style for home use. Salsa is prepared in department 1 and packaged in department 2. The activities, overhead costs, and drivers associated with these two manufacturing processes and its production support activities follow.

 

  Process Activity Overhead cost Driver Quantity
  Department 1   Mixing   $ 5,800     Machine hours 2,200   
    Cooking     12,900     Machine hours 2,200    
    Product testing     113,800     Batches 1,000    
               
      $ 132,500      
               
  Department 2   Machine calibration   $ 315,000     Production runs 500    
    Labeling     20,000     Cases of output 145,000    
    Defects     9,000     Cases of output 145,000    
               
      $ 344,000      
               
  Support   Recipe formulation   $ 82,000     Focus groups 40    
    Heat, lights, and water     33,000     Machine hours 2,200    
    Materials handling     78,000     Container types 8    
               
      $ 193,000      
               
 

 

Additional production information about its two product lines follows.

 

  Extra Fine                   Family Style                 
  Units produced 33,000 cases 112,000 cases
  Batches 330 batches 670 batches
  Machine hours 900 MH 1,300 MH
  Focus groups 30 groups 10 groups
  Container types 6 containers 2 containers
  Production runs 240 runs 260 runs

Using ABC, compute the total cost per case for each product type if the direct labor and direct materials cost is $9 per case of Extra Fine and $8 per case of Family Style. (Round your intermediate calculations and final answers to 2 decimal places.)
 

Show transcribed image text Sara's Salsa Company produces its condiments in two types: Extra Fine for restaurant customers and Family Style for home use. Salsa is prepared in department 1 and packaged in department 2. The activities, overhead costs, and drivers associated with these two manufacturing processes and its production support activities follow. Using ABC, compute the total cost per case for each product type if the direct labor and direct materials cost is $9 per case of Extra Fine and $8 per case of Family Style. (Round your intermediate calculations and final answers to 2 decimal places.)

Answers

Maurice Tutor
(5)
Status NEW Posted 18 Aug 2017 05:08 PM My Price 14.00

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