No need to show working. Due Co. manufactures two bicycles, the Mountain Bike and the Street Racer,...
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Due Co. manufactures two bicycles, the Mountain Bike and theStreet Racer, and anticipates producing 8,000 Mountain Bikes and4,000 Street Racers.
The direct material cost and direct labor cost for each bikeare:
Direct Materials
Direct Labor
Mountain Bike
$120
$240
Street Racer
$60
$160
Due’s budgeted overhead cost of $2,140,000 is based on thefollowing:
- Set-upprocedures $ 400,000
- Assembling stations $1,200,000
- Finishing $ 240,000
- Shipping $ 300,000
The following activities are needed to manufacture thebikes:
Set-up Procedures
Assembling Stations
Finishing
Shipping
Mountain Bike
6,000
12,000
8,000
4,000
Street Racer
4,000
8,000
4,000
2,000
For Questions 32 – 35, assumeDue uses activity-based costing.
- What is the cost driver rate for finishing?
- What is the cost driver rate for shipping?
- What is the manufacturing overhead cost perbike for the Mountain Bike?
- What is the total cost per bike ofthe Mountain Bike?
No need to show working.
Due Co. manufactures two bicycles, the Mountain Bike and theStreet Racer, and anticipates producing 8,000 Mountain Bikes and4,000 Street Racers.
The direct material cost and direct labor cost for each bikeare:
| Direct Materials | Direct Labor |
Mountain Bike | $120 | $240 |
Street Racer | $60 | $160 |
Due’s budgeted overhead cost of $2,140,000 is based on thefollowing:
- Set-upprocedures $ 400,000
- Assembling stations $1,200,000
- Finishing $ 240,000
- Shipping $ 300,000
The following activities are needed to manufacture thebikes:
Set-up Procedures | Assembling Stations | Finishing | Shipping | |
Mountain Bike | 6,000 | 12,000 | 8,000 | 4,000 |
Street Racer | 4,000 | 8,000 | 4,000 | 2,000 |
For Questions 32 – 35, assumeDue uses activity-based costing.
- What is the cost driver rate for finishing?
- What is the cost driver rate for shipping?
- What is the manufacturing overhead cost perbike for the Mountain Bike?
- What is the total cost per bike ofthe Mountain Bike?
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