31 bottle company operates many bottling plants around the globe at its toronto plan 4302530

 

31) Bottle Company operates many bottling plants around the globe. At its Toronto plant, where nine different brands are bottled, the following costs were incurred in 2012 to produce 15,000,000 cans of soft drink:

 

1.Development costs of adding the new product “Soda Plus” amounted to $614,000.

2.Material handling costs of inspecting and handling concentrate, bottles, packages, and so forth amounted to $433,500.These costs are allocated to each production run.

3.Incoming materials purchase costs that can be directly traced to individual products being canned and packaged. These costs are purely variable with output level and amounted to $2,213,000.

4.Executive salaries and other central administration overhead amounted to $423,000.

5.Plant overhead including costs related to: supervision, safety , energy and plant insurance amounted to $623,000.

6.The cost of cleaning and calibrating equipment for each production run amounted to $171,500.

 

Required:

a.Classify each of the preceding costs as output unit-level, batch-level, product-sustaining, or facility-sustaining.

b.Compute the cost per unit for the total manufacturing cost.

32) Brewery Company operates many bottling plants around the globe. At its Montreal plant, where six different brands are bottled, the following costs were incurred in 2012 to produce 10,000,000 bottles of beer:

 

1.Development costs of adding the new product “Light Beer Plus” amounted to $307,000.

2.Material handling costs of inspecting and handling concentrate, bottles, packages, and so forth amounted to $216,750.These costs are allocated to each production run.

3.Incoming materials purchase costs that can be directly traced to individual products being bottled and packaged. These costs are purely variable with output level and amounted to $1,106,500.

4.Executive salaries and other central administration overhead amounted to $396,000.

5.Plant overhead including costs related to: supervision, safety , energy and plant insurance amounted to $311,500.

6.The cost of cleaning and calibrating equipment for each production run amounted to $85,750.

 

Required:

a.Classify each of the preceding costs as output unit-level, batch-level, product-sustaining, or facility-sustaining.

b.Compute the cost per unit for the total manufacturing cost.

33) For each of the following activities identify an appropriate activity-cost driver.

 

a.machine maintenance

b.machine setup

c.quality control

d.material ordering

e.production scheduling

f.warehouse expense

g.engineering design