Asked by Sailesh magar on Apr 24, 2024
Desilets Corporation has provided the following data from its activity-based costing accounting system:
Distribution of Resource Consumption across Activity Cost Pools:
The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs that are not assigned to products.Required:a. Determine the total amount of supervisory wages and factory utilities costs that would be allocated to the Unit Processing activity cost pool.b. Determine the total amount of supervisory wages and factory utilities costs that would NOT be assigned to products.
Idle Capacity
The unused portion of the total available capacity within a company, often resulting in inefficiency and increased costs.
Activity-Based Costing
A costing methodology that assigns costs to products or services based on the activities they require, aiming for more accurate product costing.
Resource Consumption
The use of resources (such as raw materials, energy, or labor) in the production of goods or provision of services.
- Precisely distribute indirect costs across products utilizing the principles of activity-based costing.
- Gain insight into the contrast between allocating costs to goods and failing to allocate these costs.
Learning Objectives
- Precisely distribute indirect costs across products utilizing the principles of activity-based costing.
- Gain insight into the contrast between allocating costs to goods and failing to allocate these costs.
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