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Classic pen company case analysis

20/04/2021 Client: muhammad11 Deadline: 2 Day

i have attached the file of the Case and (I want to complete the Excel Document that I have attached)

Case Requirements:

1. Calculate a plant-wide predetermined overhead allocation rate based on direct labor cost and apply overhead to the four product lines. Calculate total product costs for the four lines using the plant-wide allocation rate and show the gross profit rate and unit cost for each.

2. What assumptions are implicit in this company’s method of allocating overhead costs to the product lines? Do you believe these assumptions are supported by the operational procedures described in this case? Discuss.

3. Identify the main activities performed in the production process. Perform a first stage cost allocation and calculate allocation rates for each activity. Comment on your results with respect to the current allocation method. Do you believe that the costs as currently calculated are accurate? Why or why not?

4. Determine the estimated cost of each product line using activity-based-costing and the gross profit rate for each. What can you conclude about the cost accuracy of the two methods? Were costs distorted using a single allocation rate method?

5. As a result of the new cost information calculated, what actions can management take to make this company more profitable? Be explicit.

*** All the information on the file that I have attached

Thank you for helping me

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