Wilkerson Case Essay
Wilkerson is a manufacturing company specializing in manufacturing components for water purification systems; the company makes valves, pumps, and flow controllers. Wilkerson is a supplier to companies that actually manufacture the water purification equipment. The relevant officers of the organization are:
* Robert Parker, President * Peggy Knight, Controller * John Scott, Manufacturing Manager
According to the United States International Trade Commission,
“U.S. exports of water filtration and purification equipment …show more content…
4. Using expected production levels, construct an ABC system. For each ABC activity pool, calculate an activity rate and an activity percentage (%). For each product, calculate the overhead cost per unit and the total cost per unit using ABC.
Manufacturing Overhead Rates | | Machine Expense/Machine hours | $30.00 | Setup Labor Cost/Production run | $250.00 | Receiving &ProdControl/Production run | $1125.00 | Engineering Cost/Hour of Engineering work | $80.00 | Packaging & Shipping/Number of shipments | $500.00 | | Pumps | Valves | Flow Controllers | Direct Material | $16.00 | $20.00 | $22.00 | Direct Labor | $10.00 | $12.50 | $10.00 | | | | | Total Prime Costs | $26.00 | $32.50 | $32.00 | | | | | MOH | | | | Machine related expense | 15.00 | 15.00 | 9.00 | Setup Labor | 0.33 | 1.00 | 6.25 | Rec & Production Control | 1.50 | 4.50 | 28.13 | Engineering | 2.67 | 2.40 | 12.50 | Packaging and Shipping | 0.67 | 2.80 | 27.50 | Total MOH | $20.17 | $25.70 | $83.38 | | | | | Total Unit Cost | $46.17 | $58.20 | $115.38 |