Required information

Exercise 4-8 Computing ABC Product Costs [LO4-2, LO4-3]

Skip to question

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

Performance Products Corporation makes two products, titanium Rims and Posts. Data regarding the two products follow:

	Direct Labor-Hours per unit	Annual Production
Rims	0.20	21,000 units
Posts	0.70	79,000 units

Additional information about the company follows:

1. Rims require $19 in direct materials per unit, and Posts require $15.
2. The direct labor wage rate is $15 per hour.
3. Rims are more complex to manufacture than Posts and they require special equipment.
4. The ABC system has the following activity cost pools:

		Estimated Activity
Activity Cost Pool	Activity Measure	Estimated Overhead Cost		Rims	Posts	Total
Machine setups	Number of setups	$	34,760	110	90	200
Special processing	Machine-hours	$	136,670	1,000	0	1,000
General factory	Direct labor-hours	$	819,000	9,000	54,000	63,000

Exercise 4-8 Part 1

Required:

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