1. Aztec Industries produces bread which goes through two operations, Mixing and Baking, before it is ready to be packaged. Next year's expected costs and activities are shown below.

	Mixing		Baking
Direct labor hours	406,000	DLH	86,000	DLH
Machine hours	806,000	MH	806,000	MH
Overhead costs	$ 507,500		$ 406,000

Compute Aztecs departmental overhead rate for the Mixing department based on machine hours.

2.

Steel Company uses activity-based costing and reports the following for this year. Compute an activity rate for each activity using activity-based costing.

Activity	Budgeted Cost	Activity Cost Driver	Budgeted Activity Usage
Cutting	$ 66,000	Machine hours (MH)	2,200	machine hours
Assembly	254,200	Direct labor hours (DLH)	6,200	direct labor hours
Total	$ 320,200