The world’s Largest Sharp Brain Virtual Experts Marketplace Just a click Away
Levels Tought:
Elementary,Middle School,High School,College,University,PHD
| Teaching Since: | May 2017 |
| Last Sign in: | 402 Weeks Ago, 2 Days Ago |
| Questions Answered: | 66690 |
| Tutorials Posted: | 66688 |
MCS,PHD
Argosy University/ Phoniex University/
Nov-2005 - Oct-2011
Professor
Phoniex University
Oct-2001 - Nov-2016
Ayala Inc. has conducted the following analysis related to its product lines, using a traditional costing system (volume-based) and an activity-based costing system. Both the traditional and the activity-based costing systems include direct materials and direct labor costs.
Â
Â
Â
Â
Â
| Â | Â |
Total Costs   |
|
|
Products   |
Sales Revenue   |
Traditional   |
ABC Â Â |
|
Product 540X Â Â |
$180,000 Â Â |
$55,000 Â Â |
$50,000 Â Â |
|
Product 137Y Â Â |
160,000 Â Â |
50,000 Â Â |
35,000 Â Â |
|
Product 249S Â Â |
70,000 Â Â |
15,000 Â Â |
35,000 Â Â |
Instructions
Â
Â
(a) For each product line, compute operating income using the traditional costing system.
Â
Â
(b) For each product line, compute operating income using the activity-based costing system.
Â
Â
(c) Using the following formula, compute the percentage difference in operating income for each of the product lines of Ayala: [Operating Income (ABC) _ Operating Income (traditional cost)] _ Operating Income (traditional cost). (Round the percentage to two decimals.)
Â
Â
(d) Provide a rationale as to why the costs for Product 540X are approximately the same using either the traditional or activity based costing system.
Hel-----------lo -----------Sir-----------/Ma-----------dam-----------Tha-----------nk -----------You----------- fo-----------r u-----------sin-----------g o-----------ur -----------web-----------sit-----------e a-----------nd -----------and----------- ac-----------qui-----------sit-----------ion----------- of----------- my----------- po-----------ste-----------d s-----------olu-----------tio-----------n.P-----------lea-----------se -----------pin-----------g m-----------e o-----------n c-----------hat----------- I -----------am -----------onl-----------ine----------- or----------- in-----------box----------- me----------- a -----------mes-----------sag-----------e I----------- wi-----------ll