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Author Question: Tiger Pride produces two product lines: T-shirts and Sweatshirts. Product profitability is analyzed ... (Read 92 times)

jerry coleman

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Tiger Pride produces two product lines: T-shirts and Sweatshirts. Product profitability is analyzed as follows:

T-SHIRTSSWEATSHIRTS
Production and sales volume192,000 units24,000 units
Selling price$17.00$29.00
Direct material$1.70$ 5.00
Direct labor$4.30$ 7.20
Manufacturing overhead$3.50$ 3.00
Gross profit$ 7.50$13.80
Selling and administrative$4.10$ 7.00
Operating profit$3.40$ 6.80

Tiger Pride's managers have decided to revise their current assignment of overhead costs to reflect the following ABC cost information:

ActivityActivity costActivity-cost driver
Supervision$123,480Direct labor hours (DLH)
Inspection$104,800Inspections

Activities demanded
T-SHIRTSSWEATSHIRTS
0.25 DLH/unit1.50 DLH/unit
48,000 DLHs36,000 DLHs
50,000 inspections15,500 inspections
Under the revised ABC system, supervision costs allocated to Sweatshirts will be ________. (Do not round interim calculations. Round the final answer to the nearest whole dollar.)
◦ $52,920
◦ $104,800
◦ $123,480
◦ None of these answers are correct.


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Marked as best answer by jerry coleman on Mar 6, 2021

joshraies

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jerry coleman

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Reply 2 on: Mar 6, 2021
Excellent


Sarahjh

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Reply 3 on: Yesterday
Great answer, keep it coming :)

 

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