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Author Question: VelshiPrinters has contracts to complete weekly supplements required by forty-six customers. For the ... (Read 20 times)

vHAUNG6011

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on: Mar 6, 2021
Velshi Printers has contracts to complete weekly supplements required by forty-six customers. For the year 2018, manufacturing overhead cost estimates total $600,000 for an annual production capacity of 12 million pages.

For 2018 Velshi Printers has decided to evaluate the use of additional cost pools. After analyzing manufacturing overhead costs, it was determined that number of design changes, setups, and inspections are the primary manufacturing overhead cost drivers. The following information was gathered during the analysis:

Cost poolManufacturing overhead costsActivity level
Design changes$120,000500 design changes
Setups380,0004,000 setups
Inspections100,0009,000 inspections
Total manufacturing overhead costs$600,000

During 2018, two customers, Money Managers and Hospital Systems, are expected to use the following printing services:

ActivityMoney ManagersHospital Systems
Pages70,00086,000
Design changes12 0
Setups177
Inspections2634

Using pages printed as the only overhead cost driver, what is the manufacturing overhead cost estimate for Money Managers during 2018?
◦ $4,300
◦ $2,800
◦ $3,500
◦ $4,784
Horngren's Cost Accounting: A Managerial Emphasis ¦ Datar, Rajan ¦ 16th Edition
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Marked as best answer by vHAUNG6011 on Mar 6, 2021

leahm14

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Reply #1 on: Mar 6, 2021
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vHAUNG6011

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Reply 2 on: Mar 6, 2021
YES! Correct, THANKS for helping me on my review

irishcancer18

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Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

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