Craft Pro Machining produces machine tools for the construction
industry. The following details about overhead costs were taken
from its company records.
| Production Activity |
Indirect Labor |
|
Indirect Materials |
|
Other Overhead |
| Grinding |
$ |
320,000 |
|
|
|
|
|
|
|
|
|
| Polishing |
|
|
|
|
$ |
195,000 |
|
|
|
|
|
| Product modification |
|
400,000 |
|
|
|
|
|
|
|
|
|
| Providing power |
|
|
|
|
|
|
|
|
$ |
210,000 |
|
| System calibration |
|
480,000 |
|
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|
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|
Additional information on the drivers for its production activities
follows.
|
|
|
| Grinding |
16,000 |
machine hours |
| Polishing |
16,000 |
machine hours |
| Product modification |
2,100 |
engineering hours |
| Providing power |
20,000 |
direct labor hours |
| System calibration |
1,500 |
batches |
|
|
Job 3175 |
Job 4286 |
| Number of units |
220 |
units |
2,750 |
units |
| Machine hours |
300 |
MH |
3,000 |
MH |
| Engineering hours |
32 |
eng. hours |
20 |
eng. hours |
| Batches |
15 |
batches |
45 |
batches |
| Direct labor hours |
460 |
DLH |
4,140 |
DLH |
|
Compute the activity overhead rates using ABC. Combine the
grinding and polishing activities into a single cost pool.
Determine overhead costs to assign to the above jobs using ABC.
What is the overhead cost per unit for Job 3175? What is the
overhead cost per unit for Job 4286? (Round your activity
rate and average overhead cost per unit to 2 decimal places. Round
"overhead assigned" to the nearest whole
dollar.)
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Job 3175 |
Job 4286 |
| Activity |
Overhead Cost |
Activity Drivers |
Activity Rate |
Activity driver incurred |
Overhead assigned |
Activity driver incurred |
Overhead assigned |
| Grinding & Polishing |
|
|
Machine hours |
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| Product modification |
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|
Engineering hrs. |
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| Providing power |
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|
Direct labor hrs. |
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| System calibration |
|
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batches |
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