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lawyer [7]
3 years ago
7

8. Hayward Industries manufactures dining chairs and tables. The following information is available: Dining ChairsTablesTotal Co

st Machine setups200600$48,000 Inspections250470$72,000 Labor hours2,6002,400 Hayward is considering switching from one overhead rate based on labor hours to activity-based costing. Instructions Perform the following analyses for these two components of overhead: a.Compute total machine setups and inspection costs assigned to each product, using a single overhead rate. b.Compute total machine setups and inspection costs assigned to each product, using activity-based costing. c.Comment on your findings.
Business
1 answer:
Contact [7]3 years ago
7 0

Answer:

Instructions are listed below.

Explanation:

Giving the following information:

Dining Chairs - Tables - Total cost

Machine setups: 200 - 600 - $48,000

Inspections: 250 - 470 - $72,000

Labor hours: 2,600 - 2,400

A) A single overhead rate:

To calculate the estimated manufacturing overhead rate we need to use the following formula:

Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Estimated manufacturing overhead rate= (48,000 + 72,000) / (2,600 + 2,400)= $24 per direct labor hour

Now, we can allocate overhead based on direct labor hours:

Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base

Dining Chairs:

Allocated MOH= 24*2,600= $62,400

Tables:

Allocated MOH= 24*2,400= $57,600

B) We have to calculate an overhead rate for each activity cost pool.

<u>Overhead rate:</u>

Machine setups:

Estimated manufacturing overhead rate= 48,000/800= $60 per machine hour set up

Inspections:

Estimated manufacturing overhead rate= 72,000/ 720= $100 per inspection

Based on the overhead rate, we can allocate overhead to each product.

Dining chairs:

Allocated MOH= 60* 200 + 100*250= $37,000

Tables:

Allocated MOH= 60*600 + 100*470= $83,000

C) We can conclude that activity cost allocation is more accurate than using a single rate plant-wide. We can allocate costs more efficiently.

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Mrrafil [7]

Answer:

Quality control

Explanation:

Six Sigma is a quality business management strategy which helps business organizations to improve the quality of processes, products and services by discovering and eliminating defects, variations or errors. It is a strategic business concept that was developed in 1986 by Motorola.

Under the six sigma approach, any process that doesn't provide customer satisfaction or causes challenges in an organisation's process should be eliminated from the system in order to produce quality products and services. It allows only 3.4 defective features for every million opportunities and as such expects processes to be defect free 99.99966 percent of the time.

Generally, there are two (2) main methods of achieving the six sigma approach;

1. DMAIC: define, measure, analyze, improve and control.

2. DMADV: define, measure, analyze, design and verify.

Hence, a pre-concert rehearsal is an example of quality control because the participants or team members are made to practice their routines so as to master them and prevent mistakes on the day of the concert. Thus, a pre-concert is aimed at getting the best out of a team in order to deliver a quality performance to the audience.

5 0
2 years ago
An increase in the demand for peanut butter could be caused by a(n)
Serggg [28]
I’d say D because its being demanded more of
8 0
2 years ago
Stefan Ceramics is in the business of selling ceramic vases. It has two departments - molding and finishing. Molding department
lakkis [162]

Answer:

Explanation:

The journal entry is shown below:

Work in Process-Molding A/c Dr $3,000

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AleksAgata [21]

Answer:

increase of VAT is bad

Explanation:

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almond37 [142]

Answer:

c

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