Direct Labor, Overhead, And Direct Material costs

Total direct labor	$1,000,000
Total overhead	$2,000,000
Overhead rate	200% of direct labor
Widgets direct labor	$100,000
Gadgets direct labor	$300,000
Smidgets direct labor	$400,000
Smadgets direct labor	$200,000
Widgets direct material	$100,000
Gadgets direct material	$200,000
Smidgets direct material	$150.000
Smadgets direct material	$250,000
Units bulit	1,000 of each product

Overhead cost driver

Cost Allocation bases	Total Costs	Quantity of CAB
Depreciation	$300,000	3,000 machine hours
Set-up	$700,000	1,000 set-up hour
Rent	$1,000,000	100,000 square feet

Product Resources Requirement by Cost Driver

Widgets	Gadgets	Simdgets	Smadgets
500 machine hours	900 machine hours	400 machine hours	1,200 machine hours
200 set-up hours	300 set-up hours	100 set-up hours	400 set-up hours
20,000 square feet	30,000 square feet	10,000 square feet	40,000 square feet

1. Calculate the activity-based overhead rate per cost driver.
2. For each product, compute the overhead costs per activity cost driver.
3. Using the overhead costs from B, calculate the total costs per product.

Answer rating: 100% (QA)

Lets break down the calculations step by step 1 ActivityBased Overhead Rate per Cost Driver Depreciation 300000 3000 machine hours 100 per machine hou... View the full answer