fr 1 B C D E F G ALT-ACTIVITY-BASED-COSTING Select Exercise (1 only) Crandall Manufacturing manufactures two furnace filters--the Basic Filter and the Super Filter. The company budgeted its Factory Overhead for the year at $239,000. The company plans to produce 2,000 units of the Basic Filter and 2,000 units of the Super Filter. FO Per Unit FO Per Unit Basic Super a. If each unit produced requires one direct labor hour, how much overhead would be assigned to each unit of Basic and each unit of Super? FO Per Unit-Traditional Hint: Total Overhead/(Total Units of Basic + Super) The company studied its Factory Overhead activities and determined that there were four activities that relate to incurring overhead costs. The four activities and their estimated costs are shown below: Activity Total Occurrences Cost Per Occurrences for Occurrences for Super FO Allocated to FO Allocated to Activities of Activity Cost Activity Base Occurrence Basic Product Line Product Line Basic Super Machine Setup/Maintenance $44,000 Setups 400 110 290 Purchasing Process $13.500 Purchase Orders 900 140 760 2 Engineering $97,500 Design Changes $84,000 Moves 1.500 300 1200 3 Materials Flow 700 200 500 14 Total Overhead Budget $239,000 Factory Overhead Assigned to Product Line $0 25 26 Units of Each Product Produced 27 28 Compare the Factory Overhead Per Unit under the traditional overhead Factory Overhead Per Unit -ABc allocation method (cells 112 and J12) with the allocation of overhead using ABC, in cells 128 and J28. The difference is dramatic 29 30 31 32 33 34 ALT ABC EAD