2/13/2016Chapter 5 – GRADED – AssignmentManagerial Accounting – MBA 520 Spring 12016: MBA 520-81 Spr

2/13/2016Chapter 5 – GRADED – AssignmentManagerial Accounting – MBA 520 Spring 12016: MBA 520-81 Spring 1 2016Ch apter 5 – GR ADED – As s ign men t1.Ashley Butterfieldin s tr u ction s | h elpvalue:33.33 poin tsExercise 5-9A Allocating costs with different cost drivers LO 5-2, 5-3Wallace Publishing identified the following overhead activities, their respective costs, and their cost driversto produce the three types of textbooks the company publishes.Type of TextbookActivity (Cost)Machine maintenance ($180,000)Setups ($315,000)Packing ($81,000)Photo development ($252,000)Cost DriverNumber of machine hoursNumber of setupsNumber of cartonsNumber of picturesDeluxe30030104,000Moderate Economy9001,20015530502,0001,000Deluxe textbooks are made with the finest-quality paper, six-color printing, and many photographs.Moderate texts are made with three colors and a few photographs spread throughout each chapter.Economy books are printed in black and white and include pictures only in chapter openings.Required:a. Wallace currently allocates all overhead costs based on machine hours. The company produced thefollowing number of books during the prior year.Deluxe50,000Moderate150,000Economy200,000Determine the overhead cost per book for each book type. (Round your answers to 2 decimalplaces.)DeluxeModerateEconomyCost per bookb. Determine the overhead cost per book, assuming that the volume-based allocation system described inRequirement a is replaced with an activity-based costing system. (Round your answers to 2 decimalplaces.)DeluxeModerateEconomyCost per bookReferenceshttp://ezto.mheducation.com/hm.tpx1/22/13/2016Chapter 5 – GRADED – AssignmentWorksheetDifficulty: 2 MediumExercise 5-9AAllocating costs withdifferent costdrivers LO 5-2, 5-3Learning Objective: 05-03 Use activity-based costing tocalculate costs of products and services.Learning Objective: 05-02Identify cost centers andcost drivers in an activitybased costing system.©2 016 M c G r aw – H i l l E d u c at i o n . A l l r i g h t s r e s e r v e d .http://ezto.mheducation.com/hm.tpx2/2

 

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