devry acct344 week 3 and week 5 homework

1.

Question
:

Alliance
Company manufactures two products (brushes and combs). The overhead costs
have been divided into four cost pools that use the following activity
drivers.

#
of Setups

#
of Orders

Machine
Hours

Packing
Orders

Brushes

30

35

2,000

100

Combs

10

65

6,000

150

Cost per Pool

$20,000

$10,000

$280,000

$60,000

a. Compute the allocation rates for each of the activity drivers listed.
b. Allocate the overhead costs to Products S and T using activity-based
costing
c. Compute the overhead rate using machine hours under the
functional-based costing system.
d. Allocate the overhead costs to Products S and T using the
functional-based costing system overhead rate calculated in part (c).

2.

Question
:

Complete Exercise 4.10 located on page 182 & 183
in the textbook.

1.

Question
:

Bubble
Corporation manufactures two products, I and II, from a joint process. A
single production costs $4,000 and results in 100 units of I and 400
units of II. To be ready for sale, both products must be processed
further, incurring separable costs of $1 per unit for I and $2 per unit
for II. The market price for Product I is $20 and for Product II is $15.

Required:
a. Allocate joint production costs to each product using the physical
units method.
b. Allocate joint production costs to each product using the net
realizable value method.
c. Allocate joint production costs to each product using the constant
gross margin percentage method.

2.

Question
:

Mike’s
Meats incurs costs of $4,000 while processing raw chicken meat into three
products: breasts, wings, and thighs. The meat is then sold to local
grocery stores based on the following.

Sales
Price per lb

Quantity
produced (lbs)

Breast

$2.00

3,000

Wings

$0.50

1,000

Thighs

$1.00

2,000

Required: (Calculate relative quantity to three decimal points.)
a. Determine the cost and gross profit percentage for each type of
chicken using the physical units method of joint cost allocation.
b. Repeat part (a) using the sales-value-at-split-off method of joint
cost allocation.
c. The company has an opportunity to sell wings to local restaurants for
$1.00 per pound but additional packaging is required, which will cost
$300 per 1,000 lb. Assuming the physical unit method is used to allocate
joint costs, should the offer be accepted?

Student Answer:

Instructor Explanation:

Points
Received:

8
of 10

Comments:

Check
part b.