# Production Costs

Purpose of AssignmentÂ
The materials covered this week distinguish between the different costing methods and provides needed tools for decision making. This case study focuses on determining equivalent units in a production business setting.Â
REVIEW THE VIDEO IN THE CLASS DISCUSSIONS FOR HELP WITH CALCULATIONS.
Assignment Steps
PART 1:
Dachshund, Inc. produces fancy, high end dog kennels and runs. They have two primary untis- a Single model and a Multi Pet model.Â You are Dachshundsâ€™ controller, and you have decidedÂ Â to use a plant-wide overhead rate based on direct labor costs.Â The president of the company recently heard of activity-based costing and wants to see how the results would differ if this system were used.Â Two activity cost pools were developed:Â machining and machine setup.Â Presented below is information related to the companyâ€™s operations:
Single Model Multi Pet Model
Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Direct labor costsÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â \$75,000Â Â Â Â Â Â Â Â Â Â Â Â Â Â \$150,000
Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Machine hoursÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 2,000Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 2,000
Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Setup hoursÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 200Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 800
Total estimated overhead costs are \$450,000.Â Overhead cost allocated to the machining activity cost pool is \$270,000 and \$180,000 is allocated to the machine setup activity cost pool.Â
IN EXCEL:
(a)Â Â Â Â Â Â Â Compute the overhead rate using the traditional (plantwide) approach.
(b)Â Â Â Â Â Â Â Compute the overhead rates using the activity-based costing approach.
(c)Â Â Â Â Â Â Â Determine the difference in allocation between the two approaches.Â
PART 2:
Dachshund, Inc. decided to implement the activity-based costing approach and was successful in its use.Â Â However, as the controller you areÂ wondering if instead of only two activity cost pools, they should expand to three activity cost pools based on the following:
Single Model Multi Pet Model
Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Direct labor costsÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â \$75,000Â Â Â Â Â Â Â Â Â Â Â Â Â Â \$150,000
Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Machine hoursÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 2,000Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 2,000
Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Setup hoursÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 200Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 800
Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Packaging hoursÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 50Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 75
The estimated overhead of \$450,000 is allocated as follows:Â machining activity cost pool \$240,000, machine set up \$170,000 and packaging \$40,000.Â
IN EXCEL:
(D) Determine the overhead rates using the activity-based costing approach with three cost pools.Â Â Â Â Â Â Â Â Â Â
(E) Determine the overhead allocation for the single model and the multi pet model using three activity cost pools.
WRITE A MEMO: Â to the president in a maximum of 500 words in which you explain:
(F) REVIEW your results for parts c and e. What is the difference in allocation between two activity cost pools and three activity cost pools?Â Is the difference in allocation worth using the third activity cost pool?Â
ShowÂ your work inÂ Â ExcelÂ®.Â
CompleteÂ calculations/computations usingÂ Â ExcelÂ®. Submit a separate spreadsheet-DO NOT embed it in your memo.
I need to see your calculations. DO NOT just type numbers in- you need to set up formulas in excel. See the week 1 tutorial.
FormatÂ your memo using the template I provided in week 1.

Basic features
• Free title page and bibliography
• Unlimited revisions
• Plagiarism-free guarantee
• Money-back guarantee
On-demand options
• Writer’s samples
• Part-by-part delivery
• Overnight delivery
• Copies of used sources
Paper format
• 275 words per page
• 12 pt Arial/Times New Roman
• Double line spacing
• Any citation style (APA, MLA, Chicago/Turabian, Harvard)

# Our guarantees

We value our customers and so we ensure that what we do is 100% original..
With us you are guaranteed of quality work done by our qualified experts.Your information and everything that you do with us is kept completely confidential.

### Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

### Zero-plagiarism guarantee

The Product ordered is guaranteed to be original. Orders are checked by the most advanced anti-plagiarism software in the market to assure that the Product is 100% original. The Company has a zero tolerance policy for plagiarism.

### Free-revision policy

The Free Revision policy is a courtesy service that the Company provides to help ensure Customer’s total satisfaction with the completed Order. To receive free revision the Company requires that the Customer provide the request within fourteen (14) days from the first completion date and within a period of thirty (30) days for dissertations.

The Company is committed to protect the privacy of the Customer and it will never resell or share any of Customer’s personal information, including credit card data, with any third party. All the online transactions are processed through the secure and reliable online payment systems.

### Fair-cooperation guarantee

By placing an order with us, you agree to the service we provide. We will endear to do all that it takes to deliver a comprehensive paper as per your requirements. We also count on your cooperation to ensure that we deliver on this mandate.

## Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
\$26
The price is based on these factors: