Green Furniture (GF) manufactures a variety of furniture for household use and just two items for office use: desks and cabinets. Theproduction process for desks and cabinets is similar, although machines must be retooled for each product. Both materials and labourcosts are directly traceable to individual products; however, overhead is a common cost and allocated using direct labour-hours as theallocation base. GF's accountant is considering the use of activity-based costing (ABC) and has suggested evaluating the system byapplying it to the two office use products (desks and cabinets). The following data are available for a typical quarter.Activity Cost PoolParts receiptsMachiningAssemblyQuality controlDirect materialsDirect labourTotal manufacturing costCost per unitActivity BaseNumber of partsMachine-hoursUnits producedUnits testedTotal manufacturing costCost per unit$$Desks26,735 $23.25 $CabinetsDesks28,27517.67Activity Rate$1.00 per part$11.00 per machine-hourEach product consumed 690 direct labour-hours.Required:1. Determine the total manufacturing cost and cost per unit for each of the two product lines for the quarter, using activity-basedcosting to allocate overhead costs. (Round "Cost per unit" answers to 2 decimal places.)$ 1.80 per unit$ 2.00 per unitCabinetsDesks2,300 parts235 machine-hours.1,150 units115 unitsActivity Usage$ 5,750$13,8002. Redo the above using direct labour-hours as the allocation base. (Round "Cost per unit" answers to 2 decimal places.)Cabinets1,600 parts345 machine-hours1,600 units1,500 units$3,200$13,800

Name: Green Furniture (GF) manufactures a variety of furniture for househol
Uploaded: 2024-03-20T06:32:49.000Z
Channel: Bartleby
Description: Green Furniture (GF) manufactures a variety of furniture for household use and just two items for office use: desks and cabinets. Theproduction process for desks and cabinets is similar, although machines must be retooled for each product. Both mate