activity rate for each activity pool. the unit product cost of each product according to the ABC system.

10 Fogerty Company makes two products-titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor- 10 Hours points per Annual Unit Production Hubs 0. 60 13,000 units eBook Sprockets 0.20 52,000 units Print References Additional information about the company follows: a. Hubs require $39 in direct materials per unit, and Sprockets require $12. b. The direct labor wage rate is $15 per hour. c. Hubs require special equipment and are more complex to manufacture than Sprockets. d. The ABC system has the following activity cost pools: Estimated Activity Overhead Activity Cost Pool (Activity Measure) Cost Hubs Sprockets Total Machine setups (number of setups) $ 20 ,520 95 76 171 Special processing (machine-hours) $175, 000 3, 500 0 3 , 500 General factory (organization-sustaining) $143, 000 NA NA NA Required: 1. Compute the activity rate for each activity cost pool. 2. Determine the unit product cost of each product according to the ABC system. Mc Graw Hill