Prescott expects to produce 225,000 basic models and 225,000 professional models. Compute the predetermined overhead allocation...

   
 

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Prescott expects to produce 225,000 basic models and 225,000 professional models. Compute the predetermined overhead allocation rates using actuvity-pasea costing. How much overhead is allocated to the basic model? To the professional model? Begin by selecting the formula to calculate the predetermined overhead (OH) allocation rate. Then enter the amounts to compute the allocation rate for each activity. (Abbreviation used: Qty = quantity. Enter the materials handling allocation rate to four decimal places, and the remaining allocation rates to the nearest cent.) Predetermined OH Estimated overhead costs Estimated qty of the allocation base allocation rate Materials Handling Basic Model Professional Model Manufacturing overhead-Assembly 264,800 $ 195,200 55,200 227,700 Manufacturing overhead-Packaging 320,000 $ 422,900 Total manufacturing overhead cost %24 Prescott wants to further refine its costing system by allocating overhead using activity-based costing. The estimated $744,000 of manufacturing overhead has been divided into three primary activities: Materials Handling, Machine Setup, and Insertion of Parts. The following data have been compiled: Materials Handling Machine Setup Insertion of Parts Total Overhead costs $54,000 $204,000 $486,000 $ 744,000 Allocation Base Number of parts Number of setups Number of parts Expected usage: Basic Model 34 parts per calculator 20 setups per year 34 parts per calculator Professional Model 62 parts per calculator 40 setups per year 62 parts per calculator Prescott expects to produce 225,000 basic models and 225,000 professional models. Compute the predetermined overhead allocation rates using actuvity-pasea costing. How much overhead is allocated to the basic model? To the professional model? Begin by selecting the formula to calculate the predetermined overhead (OH) allocation rate. Then enter the amounts to compute the allocation rate for each activity. (Abbreviation used: Qty = quantity. Enter the materials handling allocation rate to four decimal places, and the remaining allocation rates to the nearest cent.) Predetermined OH Estimated overhead costs Estimated qty of the allocation base allocation rate Materials Handling Basic Model Professional Model Manufacturing overhead-Assembly 264,800 $ 195,200 55,200 227,700 Manufacturing overhead-Packaging 320,000 $ 422,900 Total manufacturing overhead cost %24 Prescott wants to further refine its costing system by allocating overhead using activity-based costing. The estimated $744,000 of manufacturing overhead has been divided into three primary activities: Materials Handling, Machine Setup, and Insertion of Parts. The following data have been compiled: Materials Handling Machine Setup Insertion of Parts Total Overhead costs $54,000 $204,000 $486,000 $ 744,000 Allocation Base Number of parts Number of setups Number of parts Expected usage: Basic Model 34 parts per calculator 20 setups per year 34 parts per calculator Professional Model 62 parts per calculator 40 setups per year 62 parts per calculator

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Answer 1 Calculation of Predetermined OH Rate Materials Handling Est... View the full answer