Plant-wide, department, and activity-cost rates. Tarquin's Trophies makes trophies and plaques and operates at capacity. Tarquin does large custom orders, such as the participant trophies for the Mishawaka Little League. The controller has asked you to compare plant-wide, department, and activitybased cost allocation.

Other information follows:Setup costs vary with the number of batches processed in each department. The budgeted number of batches for each product line in each department is as follows:

? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ?Trophies ? ? ? ? Plaques

Forming department? ? ? ? ? ? ? ? ? ? ? ? ? ? 40 ? ? ? ? ? ? ? ?116

Assembly department ? ? ? ? ? ? ? ? ? ? ? ? ?43 ? ? ? ? ? ? ? ?103

Supervision costs vary with direct labor costs in each department.Required1. Calculate the budgeted cost of trophies and plaques based on a single plant-wide overhead rate, if total overhead is allocated based on total direct costs.2. Calculate the budgeted cost of trophies and plaques based on departmental overhead rates, where forming department overhead costs are allocated based on direct labor costs of the forming department, and assembly department overhead costs are allocated based on total direct costs of the assembly department.3. Calculate the budgeted cost of trophies and plaques if Tarquin allocates overhead costs in each department using activity-based costing.4. Explain how the disaggregation of information could improve or reduce decision quality.

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Tarquin's Trophies Budgeted Information For the Year Ended November 30, 2011 Forming Department Direct materials Trophies $13,000 15,600 Plaques $11,250 Total $24,250 24,600 Direct labor 9,000 Overhead Costs Setup Supervision 12,000 10,386 Assembly Department Direct materials Direct labor Trophies Plaques $ 9,375 10,500 Total S 2,600 $11,975 18,300 7,800 Overhead costs Setup Supervision 23,000 10,960