Continuation of S5-3: Use ABC to allocate overhead (Learning Objective 2)

Uncle Bruce just received an order to produce 12,000 single-serving bags of gourmet, fancy-cut, low-fat potato chips. The order will require 16 preparation hours and 32 cooking and draining hours. Use the activity rates you calculated in S5-3 to com¬ pute the following:

1. What is the total amount of manufacturing overhead that should be allocated to this order?

2. How much manufacturing overhead should be assigned to each bag?

3. What other costs will Uncle Bruce need to consider to determine the total manu¬ facturing costs of this order?