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Activity-Based And Department Rate Product Costing and Product Cost Distortions Black and Blue Sports Inc. manufactures two products: snowboards and skis, The factory overhead incurred is as follows: The activity base associated with the two production departments is direct fabor hours. The indirect labor can be assigned to two different activities as follows: The activity-base usage quantities and units produced for the two products follow: 1. Determine the factory overhead rates under the muftiple production department rate method. Assume that indirect labor is associated with the production departments, 50 that the total factory overhead is $315,000 and $540,000 for the Cutting and finishing departments, respectively. Rotind per unit amounts to the nearest whole cent. 2. Determine the total and per-unit factory overhead costs aflocated to each product, using the multiple production denaitment everhead rates in (1). Round ber unit amounts to the nearest whole cent. 3. Determine the activity rates, assuming that the indirect labor is associated with activities rather than with the production departments, Round per unit amounts to the nearest whole cent. 4. Determine the total and per-unit cost assigned to each product under activity-based costing. Round the per unit amounts to the nearest whole cent. 5. Comment on the difference in the per-unit overhead aliocated to each product under the multipie production denartment factory bverhead rate and activity-based costing methods. The activity-based overtead allocation reveals that snowhoards * consume more factory overhead on a per-unit basis than do multiple production department factory overhead rate * method does not show this because all factory overhead is assumed to be proportional to direct fabor hourfi. The multiple production department factory oyerhead rate " method separately accounts for the production control and materials handling activity costs. Snowboards have more phouction control and materials handing activites than do thia. This is because snowboards are made in smaller lots, representing a wide variety of styles. This, snowboards have higher-activity costs per unit than ikisi