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Exercise Chapter8

The document provides examples of different types of activity measures used at different levels of an organization. It lists 7 examples of activities measured at the unit, product, batch, customer, and other levels. Some examples of activity measures provided are number of direct labor hours, number of products designed, number of machine hours, and number of customer bills sent out.

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104 views

Exercise Chapter8

The document provides examples of different types of activity measures used at different levels of an organization. It lists 7 examples of activities measured at the unit, product, batch, customer, and other levels. Some examples of activity measures provided are number of direct labor hours, number of products designed, number of machine hours, and number of customer bills sent out.

Uploaded by

sesegar_nailofar
Copyright
© Attribution Non-Commercial (BY-NC)
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Exercise 8-8 Activity measures

Activity Examples of
Activity measures Activity measures
a) Direct labor workers assemble&product unit-level number of DL hours
b) Products are designed by engineers Product-level number of product designed
c) Equipment is setup Batch-level number of setup
d) Machine are used to shaped cut materials unit-level number of machine hours
e) Monthly bills are sent out to regular customer customer-level number of bills
f) Materials are moved from the receiving dock
to production lines Batch-level numbers of batch
g) All completed units are inspected for defects unit-level number of inspected unit

Exercise 8-9 Computing ABC Product Costs

i. Machine setup = $72,000


400
= 180/Setup
ii. Special processing = $200,000
5,000
= 40/machine hours
iii. General factory = $816,000
24,000

Exercise 8-10 First Stage Allocation


Opening Processing Processing other Other activity Total
Account Deposit customer
Teller 5%x160,000=8, 65%x16,000=10 20%x160,000=3 10%x160,000=1 160,0
wages 000 4,000 2,000 6,000 00
Assistant 15%x75,000=11 5%x75,000=375 30%x75,000=22, 50%x75,000=37, 75,00
branch ,250 0 500 500 0
managem
ent
Branch 5%x80,000=4,0 10%x80,000=8,0 85%x80,000=68, 80,00
manager 00 00 000 0
_
salary
Total 23,250 107,750 65,000 121,500 315,0
00

Exercise 8-11 Computing and Interpreting Activity Rates

Activity cost pools Total cost Total activity Activity rate


(a/b)
Opening account 23,250 500 $46.5/new account
Process deposit and 107,750 100,000 $1.08/process
withdrawals
Processing other 62,500 5,000 $12.5/other process
customer transaction

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