ngs, Inc., makes two sizes of box springs: twin and double. The direct material for the twin is $25 per unit and $40 is used in direct labor, while the direct material for the double is $45 per unit, and the labor cost is $50 per unit. Box Springs estimates it will
ngs, Inc., makes two sizes of box springs: twin and double. The direct material for the twin is $25 per unit and $40 is used in direct labor, while the direct material for the double is $45 per unit, and the labor cost is $50 per unit. Box Springs estimates it will
Chapter6: Activity-based, Variable, And Absorption Costing
Section: Chapter Questions
Problem 6PA: Box Springs, Inc., makes two sizes of box springs: twin and double. The direct material for the twin...
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Box Springs, Inc., makes two sizes of box springs: twin and double. The direct material for the twin is $25 per unit and $40 is used in direct labor, while the direct material for the double is $45 per unit, and the labor cost is $50 per unit. Box Springs estimates it will make 5,000 twins and 10,000 doubles in the next year. It estimates the overhead for each cost pool and cost driver activities as follows:
Activity Cost Pools |
Driver | Estimated Overhead |
Use per Twin |
Use per Double |
Framing | Square Feet of Pine | $200,000 | 5,000 | 3,000 |
Padding | Square Feet of Quilting | 210,000 | 120,000 | 90,000 |
Filling | Square Feet of Filling | 255,000 | 500,000 | 350,000 |
Labeling | Number of Boxes | 250,000 | 850,000 | 400,000 |
Inspection | Number of Inspections | 153,000 | 13,000 | 4,000 |
How much does each unit cost to manufacture? Do not round intermediate computations but round final answers for the fields below to the nearest whole number.
Total Cost per Unit | Twin | Double |
Direct Material | $fill in the blank 1 | $fill in the blank 2 |
Direct Labor Cost | fill in the blank 3 | fill in the blank 4 |
Overhead | fill in the blank 5 | fill in the blank 6 |
Total per Unit | $fill in the blank 7 | $fill in the blank 8 |
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