2,500 1. what is the compaines plant wide overhead rate. 2. What is the activity

Question

  

2,500

1. what is the compaines plant wide overhead rate.

2. What is the activity rate for the Machining activity cost pool

3. What is the activity rate for the Machine Setups activity cost pool pre set up

4.

Activity Cost Pool Activity Measure Estimated Overhead Cost Expected Activity   Machining Machine-hours $ 203,000    10,000 MHs   Machine setups Number of setups $ 121,900    230 setups   Production design Number of products $ 87,000    2 products   General factory Direct labor-hours $ 379,500    12,000 DLHs

Explanation / Answer

Activity Cost Pool Activity Measure Estimated Overhead Cost Expected Activity Activity rate Activity Measure Product Y OH of Y Product Z OH of Z   Machining Machine-hours $ 203000    10000.00 MHs 20.3   Machine-hours 7,300          1,48,190 2,700           54,810   Machine setups Number of setups $ 121900    230.00 setups 530   Number of setups 50            26,500 180           95,400   Production design Number of products $ 87,000    2.00 products 43500   Number of products 1            43,500 1           43,500   General factory Direct labor-hours $ 379,500    12000.00 DLHs 31.625   Direct labor-hours 9,500          3,00,438 2,500           79,063 1 Companies plantwise Overhead rate = Estimated OH / Expected activity = 379500/12000 = $ 31.625/ Labour hour 2 Activity rate for the Machining activity cost pool= OH/ Machine Hrs =203000/10000 =20.3 3 Activity rate for the Machine Setups activity cost pool pre set up = OH/ No Of setups = 121900/230 = 530 4 Activity rate for the Product Design activity cost pool per product = OH/ No of Products = 87000/2 = 43500

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