Swiss Furniture Company manufactures bookshelves and uses an activityminus-based costing system. The following information is provided for the month of May: Activity Estimated Indirect Activity Costs Allocation Base Estimated Quantity of Allocation Base Materials handling $ 7 comma 700$7,700 Number of parts 10 comma 43010,430 parts Assembling $ 10 comma 600$10,600 Number of parts 10 comma 43010,430 parts Packaging $ 2 comma 640$2,640 Number of units 1 comma 4901,490 bookshelves Each bookshelf consists of 77 parts. The direct materials cost per bookshelf is $ 28$28. What is the cost of materials handling and assembling per bookshelf? (Round all calculations to the nearest cent.)

Question

Ryann

Business

1 November, 14:43

Swiss Furniture Company manufactures bookshelves and uses an activityminus-based costing system. The following information is provided for the month of May: Activity Estimated Indirect Activity Costs Allocation Base Estimated Quantity of Allocation Base Materials handling $ 7 comma 700$7,700 Number of parts 10 comma 43010,430 parts Assembling $ 10 comma 600$10,600 Number of parts 10 comma 43010,430 parts Packaging $ 2 comma 640$2,640 Number of units 1 comma 4901,490 bookshelves Each bookshelf consists of 77 parts. The direct materials cost per bookshelf is $ 28$28. What is the cost of materials handling and assembling per bookshelf? (Round all calculations to the nearest cent.)

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Answers (1)

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Kinsley Parrish · Answer 1

Cost of material handling and assembling per book shelf = $135.0811

Explanation:

Material Handling = $7,700 for 10,430 parts

Assembling = $10,600 for 10,430 parts

Packaging $2,640 for 1,490 bookshelves.

Each bookshelf consists 77 parts

We need to calculate material handling and assembling cost per book shelf.

Material handling cost per part = $7,700/10,430 = 0.738

Cost for 77 parts = 0.738 X 77 = $56.826

Assembling costs per part = $10,600/10,430 = $1.0163

Cost for 77 parts = $1.0163 X 77 = $78.2551

Cost of material handling and assembling per book shelf = $56.826 + $78.2551 = $135.0811