Problem 3-18B Cost flows and Unit Product Costs in Activity-Based Costing [LO2, LO3, LO4]

[The following information applies to the questions displayed below.]

Fisher Company uses activity-based costing to determine product costs for external financial reports. At the beginning of the year, management made the following estimates of cost and activity in the companys five activity cost pools:

Activity Cost Pool	Activity Measure	Expected Overhead Cost		Expected Activity
Labor-related	Direct labor-hours	$	382,800	23,200	DLHs
Purchase orders	Number of orders	$	131,560	5,720	orders
Material receipts	Number of receipts	$	137,280	2,080	receipts
Relay assembly	Number of relays	$	1,195,200	14,400	relays
General factory	Machine-hours	$	1,207,800	73,200	MHs

References

Section BreakProblem 3-18B Cost flows and Unit Product Costs in Activity-Based Costing [LO2, LO3, LO4]

38.

value: 5.00 points

Required information

Problem 3-18B Part 1

Required:

1.	Compute the activity rate for each of the activity cost pools. (Round your answers to 2 decimal places.)

References

eBook & Resources

WorksheetDifficulty: 3 HardLearning Objective: 03-03 Compute product costs using activity-based costing.

Problem 3-18B Part 1Learning Objective: 03-02 Compute activity rates for an activity-based costing system.Learning Objective: 03-04 Contrast the product costs computed under activity-based costing and conventional costing methods.

39.

value: 5.00 points

Required information

Problem 3-18B Part 2

2.	The expected activity for the year was distributed among the companys four products as follows:

	Expected Activity
Activity Cost Pool	Product A	Product B	Product C	Product D
Labor related (DLHs)	7,800	1,800	8,800	4,800
Production orders (orders)	1,000	1,060	1,300	2,360
Materials receipts (receipts)	480	840	340	420
Relay assembly (relays)	4,300	2,400	3,400	4,300
General factory (MHs)	16,800	26,800	17,800	11,800

Using the ABC data, determine the total amount of overhead cost applied to each product.