Assume Orth and Associates, discussed in Problem 44, uses activity-based costing. 

Required:

a. Using the data presented at the beginning of Problem 44, calculate the predetermined overhead rate for each activity. Round results to the nearest cent.

b. The following activity associated with the commercial product was reported for the month of September.

Using the predetermined overhead rates calculated in requirement a, determine the amount of overhead applied to the commercial product for the month of September.

c. Make the journal entry to record overhead applied to the commercial product for the month of September.

d. Assume you are manager of the commercial product line and would like to reduce the amount of overhead costs being applied to your products. Which activity would you focus on first? Why?

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Number of direct labor hours 350 Number of computer hours 960 Number of applications 50