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Brilliant Accents Company Manufactures and Sells Three Styles of Kitchen

question 143

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Brilliant Accents Company manufactures and sells three styles of kitchen faucets: Brass,Chrome,and White.Production takes 25,25,and 10 machine hours to manufacture 1,000-unit batches of brass,chrome,and white faucets,respectively.The following additional data apply:
Brilliant Accents Company manufactures and sells three styles of kitchen faucets: Brass,Chrome,and White.Production takes 25,25,and 10 machine hours to manufacture 1,000-unit batches of brass,chrome,and white faucets,respectively.The following additional data apply: PER UNIT data: Overhead cost based on direct labor hours Hours per 1000-unit batch: Total overhead costs and activity levels for the year are estimated as follows: Required: a.Using the traditional system,determine the operating profit per unit for the brass style of faucet. b.Determine the activity-cost-driver rate for setup costs and inspection costs. c.Using the ABC system,for the brass style of faucet: d.Explain the difference between the profits obtained from the traditional system and the ABC system.Which system provides a better estimate of profitability? Why?
PER UNIT data:
Brilliant Accents Company manufactures and sells three styles of kitchen faucets: Brass,Chrome,and White.Production takes 25,25,and 10 machine hours to manufacture 1,000-unit batches of brass,chrome,and white faucets,respectively.The following additional data apply: PER UNIT data: Overhead cost based on direct labor hours Hours per 1000-unit batch: Total overhead costs and activity levels for the year are estimated as follows: Required: a.Using the traditional system,determine the operating profit per unit for the brass style of faucet. b.Determine the activity-cost-driver rate for setup costs and inspection costs. c.Using the ABC system,for the brass style of faucet: d.Explain the difference between the profits obtained from the traditional system and the ABC system.Which system provides a better estimate of profitability? Why?
Brilliant Accents Company manufactures and sells three styles of kitchen faucets: Brass,Chrome,and White.Production takes 25,25,and 10 machine hours to manufacture 1,000-unit batches of brass,chrome,and white faucets,respectively.The following additional data apply: PER UNIT data: Overhead cost based on direct labor hours Hours per 1000-unit batch: Total overhead costs and activity levels for the year are estimated as follows: Required: a.Using the traditional system,determine the operating profit per unit for the brass style of faucet. b.Determine the activity-cost-driver rate for setup costs and inspection costs. c.Using the ABC system,for the brass style of faucet: d.Explain the difference between the profits obtained from the traditional system and the ABC system.Which system provides a better estimate of profitability? Why?
Overhead cost based on direct labor hours
Brilliant Accents Company manufactures and sells three styles of kitchen faucets: Brass,Chrome,and White.Production takes 25,25,and 10 machine hours to manufacture 1,000-unit batches of brass,chrome,and white faucets,respectively.The following additional data apply: PER UNIT data: Overhead cost based on direct labor hours Hours per 1000-unit batch: Total overhead costs and activity levels for the year are estimated as follows: Required: a.Using the traditional system,determine the operating profit per unit for the brass style of faucet. b.Determine the activity-cost-driver rate for setup costs and inspection costs. c.Using the ABC system,for the brass style of faucet: d.Explain the difference between the profits obtained from the traditional system and the ABC system.Which system provides a better estimate of profitability? Why?
Hours per 1000-unit batch:
Brilliant Accents Company manufactures and sells three styles of kitchen faucets: Brass,Chrome,and White.Production takes 25,25,and 10 machine hours to manufacture 1,000-unit batches of brass,chrome,and white faucets,respectively.The following additional data apply: PER UNIT data: Overhead cost based on direct labor hours Hours per 1000-unit batch: Total overhead costs and activity levels for the year are estimated as follows: Required: a.Using the traditional system,determine the operating profit per unit for the brass style of faucet. b.Determine the activity-cost-driver rate for setup costs and inspection costs. c.Using the ABC system,for the brass style of faucet: d.Explain the difference between the profits obtained from the traditional system and the ABC system.Which system provides a better estimate of profitability? Why?
Total overhead costs and activity levels for the year are estimated as follows:
Brilliant Accents Company manufactures and sells three styles of kitchen faucets: Brass,Chrome,and White.Production takes 25,25,and 10 machine hours to manufacture 1,000-unit batches of brass,chrome,and white faucets,respectively.The following additional data apply: PER UNIT data: Overhead cost based on direct labor hours Hours per 1000-unit batch: Total overhead costs and activity levels for the year are estimated as follows: Required: a.Using the traditional system,determine the operating profit per unit for the brass style of faucet. b.Determine the activity-cost-driver rate for setup costs and inspection costs. c.Using the ABC system,for the brass style of faucet: d.Explain the difference between the profits obtained from the traditional system and the ABC system.Which system provides a better estimate of profitability? Why?
Required:
a.Using the traditional system,determine the operating profit per unit for the brass style of faucet.
b.Determine the activity-cost-driver rate for setup costs and inspection costs.
c.Using the ABC system,for the brass style of faucet:
Brilliant Accents Company manufactures and sells three styles of kitchen faucets: Brass,Chrome,and White.Production takes 25,25,and 10 machine hours to manufacture 1,000-unit batches of brass,chrome,and white faucets,respectively.The following additional data apply: PER UNIT data: Overhead cost based on direct labor hours Hours per 1000-unit batch: Total overhead costs and activity levels for the year are estimated as follows: Required: a.Using the traditional system,determine the operating profit per unit for the brass style of faucet. b.Determine the activity-cost-driver rate for setup costs and inspection costs. c.Using the ABC system,for the brass style of faucet: d.Explain the difference between the profits obtained from the traditional system and the ABC system.Which system provides a better estimate of profitability? Why?
d.Explain the difference between the profits obtained from the traditional system and the ABC system.Which system provides a better estimate of profitability? Why?

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