San Diego State University Operations And Supply Chain Management Assignment Help - Purchase

Question - Rusties Company recently implemented an activity-based costing system. At the beginning of the
year, management made the following estimates of cost and activity in the company's five activity cost
pools:
Activity Cost Pool Activity Measure
Expected
Overhead
Cost
Expected Activity
Labor-related Direct labor-hours $ 18,000 2,000 DLHs
Purchase orders Number of orders $ 1,050 525 orders
Product testing Number of tests $ 3,500 350 tests
Template etching Number of templates $ 700 28 templates
General factory Machine-hours $ 50,000 10,000 MHs



5.
Required:
1. Compute the activity rate for each of the activity cost pools.

Activity Cost Pool Activity Rate
Labor-related $ per DLH
Purchase orders $ per order
Product testin ...Read More g $ per test
Template etching $ per template
General factory $ per MH

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6.
2. The expected activity for the year was distributed among the company's four products as follows:

Activity Cost Pool
Expected Activity

Product A Product B Product C Product D
Labor-related (DLHs) 500 100 700 700
Purchase orders (orders) 80 105 180 160

Product testing (tests) 200 60 0 90
Template etching (templates) 0 14 10 4
General factory (MHs) 3,400 2,200 1,800 2,600


Using the ABC data, determine the total amount of overhead cost assigned to each product.


Total
Overhead Cost
Product A $
Product B $
Product C $
Product D $ ...Read Less

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