Activity-Based Costing: Factory Overhead Costs The total factory overhead for Ba

Question

Activity-Based Costing: Factory Overhead Costs

The total factory overhead for Bardot Marine Company is budgeted for the year at $726,000, divided into four activity pools: fabrication,, $352,000; assembly, $132,000; setup, $132,000; and inspection, $110,000. Bardot Marine manufactures two types of boats: speedboats and bass boats. The activity-base usage quantities for each product by each activity are as follows:

Each product is budgeted for 3,500 units of production for the year.

a. Determine the activity rates for each activity.

b. Determine the activity-based factory overhead per unit for each product. Round to the nearest whole dollar.

Fabrication Assembly Setup Inspection Speedboat 5,500 dlh 16,500 dlh 40 setups 69 inspections Bass boat 16,500 5,500 290 481 22,000 dlh 22,000 dlh 330 setups 550 inspections

Explanation / Answer

a. The correct answer is:

Note :

b.

The correct answer is :

Note :

1.

2.

Fabrication $ 16 per direct labor hour Assembly $ 6 per direct labor hour Setup $ 400 per setup Inspection $ 200 per inspection

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