BM2021

Names of students: Renion, Gabriela M. & Sena, Ma. Carmella S. Section: BSA601 Date:

ACTIVITY
DGM Marble Manufacturing
The management of DGM Marble Manufacturing has identified activity centers to which overhead
costs are assigned. The following data are available:

Activity Centers Costs Activity Drivers

Utilities P400,000 80,000 machine hours
Scheduling and Setup 379,950 800 setups
Material Handling 828,000 1,800,000 pounds of materials

The company’s products and other operating statistics are the following:

A. Ceramic Tiles B. Granite Tiles C. Onyx Tiles

Prime costs P120,000 P130,000 P150,000
Machine hours 40,000 20,000 20,000
Number of setups 150 400 250
Pounds of materials 800,000 500,000 500,000
Number of units produced 60,000 35,000 60,000
Direct labor hours 35,000 26,000 50,000

Provide the following based on the procedures of the Activity-Based Costing (ABC) system. (2 items x
10 points)

A. Pool rates

Activity Centers Solution Pool rates

Utilities P 400,000/80,000 P 5/mhr.
Scheduling & setup P 379,950/800 P 474.9375 or P474.94/set
up
Materials handling P 828,000/1,800,000 P 0.46/lb.

B. Overhead cost allocated to each product of DGM Marble Manufacturing

Product A Product B Product C Onyx Total

Ceramic Tiles Granite Tiles Tiles
Utilities
A. 40,000 x P 5 P 200,000
B. 20,000 x P 5 P 100,000
C. 20,000 x P 5 P 100,000
P 400,000
Scheduling and setup
A. 150 x P 474.94 P 71,240.63
B. 400 x P 474.94 P 189,975
C. 250 x P 474.94 P 118,734.4
P 379,950

06 Activity 1 *Property
of STI
 BM2021
Names of students: Renion, Gabriela M. & Sena, Ma. Carmella S. Section: BSA601 Date:

Material handling
A. 800,000 x P .46 P 368,000
B. 500,000 x P .46 P 230,000
C. 500,000 x P .46 P 230,000
P 828,000
TOTAL P 639,240.6 P 519,975 P 448,734.4 P 1,607,950

Rubric for grading:

CRITERIA POINTS
Complete solution with correct answer 10
Last two (2) major steps of the solution are incorrect 7
Half of the solution is correct 5
First two (2) major steps of the solution are correct 3
First major step of the solution is correct 1

06 Activity 1 *Property
of STI