Aerobic Lifestyles Inc. manufactures stationary bicycles and rowing machines. The products are produced in the Fabrication and

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Aerobic Lifestyles Inc. manufactures stationary bicycles and rowing machines. The products are produced in the Fabrication and Assembly production departments. In addition to production activities, several other activities are required to produce the two products. These activities and their associated activity rates are as follows:
Activity Activity Rate
Fabrication ........... $24 per machine hour
Assembly .......... $12 per direct labor hour
Setup ............. $40 per setup
Inspecting ............ $24 per inspection
Production scheduling ....... $14 per production order
Purchasing ........... $5 per purchase order
The activity-base usage quantities and units produced for each product were as follows:

Aerobic Lifestyles Inc. manufactures stationary bicycles and row

Use the activity rate and usage information to calculate the total activity costs and the activity costs per unit for eachproduct.

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Accounting

ISBN: 978-0324188004

21st Edition

Authors: Carl s. warren, James m. reeve, Philip e. fess

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