1 1 After reading an article about activity-based costing in a trade journal for the furniture industry, Santana Rey decides to analyze overhead cost at Business Solutions. In a recent month, Santana found that setup costs, inspection costs, and utility costs made up most of the company's overhead. Additional information about overhead follows. Activity Set up Inspection Utilities Budgeted Cost $ 20,000 7,500 10,000 $ 37,500 Budgeted Activity Usage 25 setups 5,000 parts inspected 5,000 machine hours (MH) Total The following data pertain to Job 615. Direct materials Direct labor Overhead Setups Parts inspected Machine hours $ 2,500 $ 3,500 $ 2 setups 400 parts inspected 600 machine hours Required: 1. Classify each of the three overhead activities as unit level, batch level, product level, or facility level. 2. Assume Business Solutions allocates overhead cost using a plantwide rate based on 5,000 machine hours. Compute total product cost of Job 615. 3. Assume Business Solutions uses activity-based costing. (a) Compute overhead activity rates. (b) Allocate overhead cost to Job 615. (C) Compute total product cost of Job 615. 1 level, product level, or facility level. 2. Assume Business Solutions allocates overhead cost using a plantwide rate based on 5,000 machine hours. Compute total product cost of Job 615. 3. Assume Business Solutions uses activity-based costing. (a) Compute overhead activity rates. (b) Allocate overhead cost to Job 615. (C) Compute total product cost of Job 615. Required 1 Required 2 Required 3 Classify each of the three overhead activities as unit level, batch level, proc Batch level Setup Inspection Utilities Unit level Facility level Required 1 Required 2 Required 3 Assume Business Solutions uses activity-based costing. (a) Compute overhead activity rates. (b) Allocate overhead cost to Job 615. (C) Compute total product cost of Job 615. (Round "Activity Rate" to 2 decimal places.) per part per MH a. Compute overhead activity rates Activity Activity Rate Setup per setup Inspection Utilities b. Allocate overhead to Job 615 based on actual activity usage Activity Allocated Cost Setup Inspection Utilities Total allocated cost $ 0 c. Total product cost of Job 615 based on activity-based costing Job 615 Direct Materials Direct Labor Overhead Product Cost $ 0 Required 1 Required 2 Required 3 Assume Business Solutions uses activity-based costing. (a) Compute overhead activity rates. (b) Allocate overhead cost to Job 615. (C) Compute total product cost of Job 615. (Round "Activity Rate" to 2 decimal places.) per part per MH a. Compute overhead activity rates Activity Activity Rate Setup per setup Inspection Utilities b. Allocate overhead to Job 615 based on actual activity usage Activity Allocated Cost Setup Inspection Utilities Total allocated cost $ 0 c. Total product cost of Job 615 based on activity-based costing Job 615 Direct Materials Direct Labor Overhead Product Cost $ 0