Activity-based costing: factory overhead costs OBJ. 4 The total factory overhead for Diva-nation is budgeted for the
Question:
Activity-based costing: factory overhead costs OBJ. 4 The total factory overhead for Diva-nation is budgeted for the year at $180,000, divided into four activities: cutting, $18,000; sewing, $36,000; setup, $96,000; and inspection, $30,000.
Diva-nation manufactures two types of men’s pants: jeans and khakis. The activity-base usage quantities for each product by each activity are as follows:
Cutting Sewing Setup Inspection Jeans 800 dlh 1,200 dlh 1,400 setups 3,000 inspections Khakis 1,200 800 1,000 2,000 _____ _____ _____ _____ 2,000 dlh 2,000 dlh 2,400 setups 5,000 inspections _____ _____ _____ _____ _____ _____ _____ _____ Each product is budgeted for 20,000 units of production for the year. Determine
(a) the activity rates for each activity and
(b) the activity-based factory overhead per unit for each product.
Step by Step Answer:
Financial And Managerial Accounting
ISBN: 9781305267831,9781305267848
13th Edition
Authors: Carl S. Warren , James M. Reeve , Jonathan Duchac