ACTIVITY-BASED COSTING, COST DRIVERS Southern Metals Company's controller has established these overhead cost pools and cost...

 

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ACTIVITY-BASED COSTING, COST DRIVERS Southern Metals Company's controller has established these overhead cost pools and cost drivers for Overhead Cost Pool Machine setups Power Materials handling Quality control Other overhead Budgeted Overhead Required 1. 2. $117,868 341,120 85,000 143,500 184,500 $871,988 Expected Cost Driver Number of setups Machine-hours Materials weight Number of units Direct labor-hours Activity Level 40 During March 2001, Southern received an order for 1,500 machine tools and produced them. The order required the following: Machine setups Machine-hours Materials Direct labor-hours 3,250 4,250 lb. 2,750 hours 21,320 34,000 lb. 82,000 units 14,760 hours Calculate the predetermined factory overhead rates for cost drivers. What was the total factory overhead assigned to fill the order under the activity-based costing approach? 3. Suppose that a single predetermined factory overhead rate based on machine-hours was used to apply factory overhead. What was the pre- determined factory overhead rate? What amount of factory overhead was applied to the order? ACTIVITY-BASED COSTING, COST DRIVERS Southern Metals Company's controller has established these overhead cost pools and cost drivers for Overhead Cost Pool Machine setups Power Materials handling Quality control Other overhead Budgeted Overhead Required 1. 2. $117,868 341,120 85,000 143,500 184,500 $871,988 Expected Cost Driver Number of setups Machine-hours Materials weight Number of units Direct labor-hours Activity Level 40 During March 2001, Southern received an order for 1,500 machine tools and produced them. The order required the following: Machine setups Machine-hours Materials Direct labor-hours 3,250 4,250 lb. 2,750 hours 21,320 34,000 lb. 82,000 units 14,760 hours Calculate the predetermined factory overhead rates for cost drivers. What was the total factory overhead assigned to fill the order under the activity-based costing approach? 3. Suppose that a single predetermined factory overhead rate based on machine-hours was used to apply factory overhead. What was the pre- determined factory overhead rate? What amount of factory overhead was applied to the order?

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The image displays an activitybased costing exercise with several cost pools and their respective budgeted overhead and cost drivers The company recei... View the full answer