Chrome File Edit View History Bookmarks People Window Help (-C ? ezto.mheducatio

Question

Chrome File Edit View History Bookmarks People Window Help (-C ? ezto.mheducation.com.tm.tpx Apps ?Bookmarks Fellar Corp. has identified the following information Activity cost pools Materials handling Machine maintenance $38.280 26,400 Cost drivers Number of material moves Number of machine hours 870 66.000 Required: 1. Calculate the activity rate for each cost pool. (Round your answers to 2 decimal places.) Activity Rate Material Handling per Material Move Machine Maintenance per Machine Hour 2. Determine the amount of overhead assigned to Fellar's products if they have the following activity demands: (Round your interme final answers to the nearest whole dollar amount.) Product A Product B Number of material moves Number of machine hours 41,700 24,300 Product A Product B 20 2 4

Explanation / Answer

Answer 1.

Activity Rate for Material Handling = Activity Cost / Number of materials moves
Activity Rate for Material Handling = $38,280 / 870
Activity Rate for Material Handling = $44.00

Activity Rate for Machine Maintenance = Activity Cost / Number of machine hours
Activity Rate for Machine Maintenance = $26,400 / 66,000
Activity Rate for Machine Maintenance = $0.40

Answer 2.

Product A:

Total Overhead Assigned = 480 * $44.00 + 41,700 * $0.40
Total Overhead Assigned = $37,800

Product B:

Total Overhead Assigned = 390 * $44.00 + 24,300 * $0.40
Total Overhead Assigned = $26,880

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