5. (Continued from Problems 3 and 4) (10 points) The cost accountant of ABC Manufacturing attended...

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5. (Continued from Problems 3 and 4) (10 points) The cost accountant of ABC Manufacturing attended a workshop on activity-based costing and was impressed by the results. After consulting with the production personnel, he prepared the following information on cost drivers and the estimated volume for each driver. Cost Driver Volume Activity Cost Driver Ace Best Champ Total Machining: Setup Number of setups 125 75 50 250 Machining Machine hours 2,500 1,500 2,000 6,000 Assembly: Assembly Direct labor hours 25,000 Inspection Number of inspections 50 50 15,000 5,000 45,000 25 25 100 25 The cost accountant also determined how much overhead costs were incurred in each of the four activities as follows: Machining: Setup Activity Machining Total Machining department overhead Assembly: Assembly Overhead Costs $ 150,000 750,000 900,000 360,000 Inspection 90,000 Total Assembly department overhead 450,000 Total overhead costs $1,350,000 H I Required: 1. Determine the cost driver rate for each activity cost pool. 2. Use the activity-based costing method to determine the unit cost for each product. Summarize and comment on the results. 3. 5. (Continued from Problems 3 and 4) (10 points) The cost accountant of ABC Manufacturing attended a workshop on activity-based costing and was impressed by the results. After consulting with the production personnel, he prepared the following information on cost drivers and the estimated volume for each driver. Cost Driver Volume Activity Cost Driver Ace Best Champ Total Machining: Setup Number of setups 125 75 50 250 Machining Machine hours 2,500 1,500 2,000 6,000 Assembly: Assembly Direct labor hours 25,000 Inspection Number of inspections 50 50 15,000 5,000 45,000 25 25 100 25 The cost accountant also determined how much overhead costs were incurred in each of the four activities as follows: Machining: Setup Activity Machining Total Machining department overhead Assembly: Assembly Overhead Costs $ 150,000 750,000 900,000 360,000 Inspection 90,000 Total Assembly department overhead 450,000 Total overhead costs $1,350,000 H I Required: 1. Determine the cost driver rate for each activity cost pool. 2. Use the activity-based costing method to determine the unit cost for each product. Summarize and comment on the results. 3.

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Cost driver rate for each activity cost pool a Machining Setup Cost driver volume Number of setups Total Machining Setup overhead costs 150000 Cost driver rate Total Machining Setup overhead costs Cos... View the full answer