Question

Weber Industries has three activity cost pools and two products. It estimates the production of 3,000...

Weber Industries has three activity cost pools and two products. It estimates the production of 3,000 units of Product BC113 and 1,400 of Product AD908. Having identified its activity cost pools and the cost drivers for each pool, Weber accumulated the following data relative to those activity cost pools and cost drivers

Annual Overhead Data Estimated Use of Cost
Drivers per
Product
Activity Cost Pool Cost Drivers Estimated
Overhead
Estimated Use of
Cost Drivers per Activity
Product
BC113
Product
AD908
Machine set-up Set-ups $ 20,855 43 27 16
Machining Machine hours 111,760 5,080 1,016 4,064
Packing Orders 29,120 520 156 364

Prepare a schedule showing the calculations of the activity-based overhead rates per cost driver.

a.

Cost Pool Estimated
MOH
Estimated
Usage
Rate
Machine set-up $enter a dollar amount enter the estimated usage $enter a dollar amount per set-up
Machining
Packing

b.Prepare a schedule assigning each activity’s overhead cost to the two products.

c. Calculate the overhead cost per unit for each product.

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