Snavely, Inc., manufactures and sells two products: Product E1and Product A7. Data concerning the expected production of
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Snavely, Inc., manufactures and sells two products: Product E1and Product A7. Data concerning the expected production of each product and the expected total direct labor-hours (DLHs) required to produce that output appear below:
Expected Production | Direct Labor-Hours Per Unit | Total Direct Labor-Hours | |
Product E1 | 1,000 | 10.0 | 10,000 |
Product A7 | 200 | 5.0 | 1,000 |
Total direct labor-hours | 11,000 | ||
The direct labor rate is $25.00 per DLH. The direct materials cost per unit for each product is given below:
Direct Materials Cost per Unit | |||
Product E1 | $233.00 | ||
Product A7 | $200.00 | ||
The company has an activity-based costing system with the following activity cost pools, activity measures, and expected activity:
Estimated | Expected Activity | |||||
Activity Cost Pools | Activity Measures | Overhead Cost | Product E1 | Product A7 | Total | |
Labor-related | DLHs | $ | 135,700 | 10,000 | 1,000 | 11,000 |
Machine setups | setups | 64,000 | 1,100 | 200 | 1,300 | |
Order size | MHs | 1,001,010 | 2,800 | 3,200 | 6,000 | |
$ | 1,200,710 | |||||
The total overhead applied to Product E1 under activity-based costing is closest to: (Round your intermediate calculations to 2 decimal places.)
Multiple Choice
$644,705
$2,007,870
$1,200,779
$467,152
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