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The Alliance For Global Education Operations And Supply Chain Management Assignment Help - Activity Based Costing

Question - Outdoor Texas makes umbrellas, gazebos, and chaise lounges. The company uses a traditional overhead allocation scheme and assigns overhead to products at the rate of $30 per direct labor hour. The costs per unit for each product group in 2013 were as follows: Umbrellas Gazebos Lawn Chairs Direct material $ 12 $ 120 $ 12 Direct labor overhead 18 24 135 180 45 60 Total 54 435 117 Because profitability has been lagging and competition has been getting more intense, Outdoor Living is considering implementing an activity-based costing system for 2014. In analyzing the 2013 data, management determined that all $12,030,000 of factory over head could be assigned to four basic activities: quality control, setups, material handlin ...Read More

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