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Two-Stage ABC for Manufacturing

Assume Sherwin-Williams Company, a large paint manufacturer, has determined the following activity cost pools and cost driver levels for the latest period:

The following data are for the production of single batches of two products, Mirlite and Subdue:

Determine the batch and unit costs per gallon of Mirlite and Subdue using ABC.

Round cost per gallon to two decimal places.

CoursHeroTranscribedText: Two-Stage ABC for Manufacturing Assume Sherwin-williams Company, a large paint manufacturer, has determined the following activity cost pools and cost driver levels for the latest period: Activity Cost Pool Activity Cost Activity Cost Driver Machine setup $950,000 2,500 setup hours Material handling 820,000 5,000 material moves Machine operation 200,000 20,00 The following data are for the production of single batches of two products, Mirlite and Subdue: Mirlite Subdue Gallons produced 50,000 30,000 Direct labor hours 400 250 Machine hours 800 250 Direct labor cost $10,000 $7,500 Direct materials cost $350,000 $150,000 Setup hours 12 Material moves 60 35 Determine the batch and unit costs per gallon of Mirlite and Subdue using ABC. Round cost per gallon to two decimal places. Product Cost Mirlite Subdue Direct materials $ $ Direct labor Manufacturing overhead; Machine setups Material handling Machine operation Total cost per batch $ $ Gallons produced Cost per gallon $ $

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