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management accounting question 422803
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Jansen Painting paints the interiors and exteriors of homes and commercial buildings. The company uses an activity based costing system for its overhead costs. The company has provided the following data concerning its activity based costing system. |
| Activity Cost Pool | Activity Measure | Annual Activity |
| Painting | Square meters | 25,600 square meters |
| Job support | Jobs | 280 jobs |
| Other | None | Not applicable |
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The “Other” activity cost pool consists of the costs of idle capacity and organization sustaining costs. |
| Painting | Job Support | Other | Total | |||||
| Production overhead | $ | 38,400 | $ | 37,268 | $ | 25,500 | $ | 101,168 |
| Office expense | 11,520 | 78,120 | 11,528 | 101,168 | ||||
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| Total | $ | 49,920 | $ | 115,388 | $ | 37,028 | $ | 202,336 |
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Required:
| a. |
Compute the activity rates (i.e., cost per unit of activity) for the Painting and Job Support activity cost pools. (Round your intermediate and final answers to 2 decimal places.Omit the “$” sign in your response.) |
| Painting | Job Support | |
| Production overhead | $ | $ |
| Office expense | ||
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| Total | $ | $ |
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| b. |
Prepare a overhead costs report and an action analysis report in good form of a job that involves painting 172 square meters and has direct materials and direct labor cost of $3,930. The sales revenue from this job is $4,950. |
| Overhead Cost Report | |||
| Painting | Job Support | Total | |
| Activity | 172 | 1 | |
| Production overhead | $ | $ | $ |
| Office expense | |||
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| Total cost | $ | $ | $ |
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| Action Analysis Report | ||
| Sales | $ 4,950.00 | |
| Green Costs: | ||
| (Click to select)Production overheadSalesYellow marginWages and salariesRed marginGreen marginDirect materials and laborOffice expense | $ | |
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| (Click to select)Green marginDirect materials and laborRed marginProduction overheadWages and salariesYellow marginOffice expenseSales | ||
| Yellow costs: | ||
| (Click to select)Wages and salariesOffice expenseGreen marginSalesYellow marginRed marginProduction overheadDirect materials and labor | ||
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| (Click to select)Direct materials and laborGreen marginRed marginProduction overheadWages and salariesOffice expenseYellow marginSales | ||
| Red costs: | ||
| (Click to select)Production overheadGreen marginSalesWages and salariesDirect materials and laborRed marginYellow marginOffice expense | ||
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| (Click to select)Office expenseYellow marginRed marginProduction overheadDirect materials and laborGreen marginSalesWages and salaries | $ | |
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