Question 1 options:

Entry Rules:

Round your answer totwo (2) decimal places.

Examples:

If your answer is $24,500.4718, enter 24500.47

If your answer is $24,500.4753, enter 24500.48

If your answer is $24,500.00, enter 24500.00

If your answer is $0.4718, enter 0.47

If your answer is ZERO, enter 0.00

Never enter $ or , when inputting numerical answers

QUESTION:

Hallway Inc. manufactures a variety of patio chairs. The costing system was designed using an activity-based costing system. The following budgeted information is available at the beginning of the year:

	Product A	Product B
Quantity	100,000	800,000
Selling price	$900.00	$750.00
Units prime cost	$529.00	$483.00

In addition, the following information was provided so that overhead costs could be assigned to each product:

Activity Name	Activity Driver	Budgeted Activity Cost	Product A Annual Activity	Product B Annual Activity
Setups	Number of set ups	$2,000,000	300	200
Machining	Machine hours	$80,000,000	100,000	300,000
Engineering	Engineering hours	$6,000,000	50,000	100,000
Packing	Packing orders	$1,000,000	100,000	400,000

Use the above information to answer the following questions.

What is the activity-based overhead rate for Setups?

HINT: remember to apply the entry rules.