Air United, Inc. manufactures two products: missile range instruments and space pressure gauges. During April, 50 range instruments and 200 pressure gauges were produced, and overhead costs of $84,620 were estimated. An analysis of estimated overhead costs reveals the following activities.
Activities |
Cost Drivers |
Total Cost |
||||
---|---|---|---|---|---|---|
1. | Materials handling | Number of requisitions |
$32,640 |
|||
2. | Machine setups | Number of setups |
29,100 |
|||
3. | Quality inspections | Number of inspections |
22,880 |
|||
$84,620 |
The cost driver volume for each product was as follows.
Cost Drivers |
Instruments |
Gauges |
Total |
|||
---|---|---|---|---|---|---|
Number of requisitions | 410 | 610 | 1,020 | |||
Number of setups | 210 | 275 | 485 | |||
Number of inspections | 275 | 245 | 520 |
Determine the overhead rate for each activity.
Overhead Rate |
|||
---|---|---|---|
Materials handling |
$enter a dollar amount per requisition |
per requisition | |
Machine setups |
$enter a dollar amount per setup |
per setup | |
Quality inspections |
$enter a dollar amount per inspection |
per inspection |
eTextbook and Media
Assign the manufacturing overhead costs for April to the two products using activity-based costing. (Round per unit answers to 2 decimal places, e.g. 12.25.)
Instruments |
Gauges |
|||
---|---|---|---|---|
Total cost assigned |
$enter a dollar amount rounded to 2 decimal places |
$enter a dollar amount rounded to 2 decimal places |
||
Overhead cost per Unit |
$enter a dollar amount rounded to 2 decimal places |
$enter a dollar amount rounded to 2 decimal places |
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