2.

The Ramapo Company produces two products, Blinks and Dinks. They are manufactured in two departments, Fabrication and Assembly. Data for the products and departments are listed below.

Product	Number of Units	Labor Hours Per Unit	Machine Hours Per Unit
Blinks	1,007	5	4
Dinks	1,849	4	6

All of the machine hours take place in the Fabrication department, which has an estimated overhead of $81,200. All of the labor hours take place in the Assembly department, which has an estimated total overhead of $78,800.

The Ramapo Company uses a single overhead rate to apply all overhead costs. What would the single plantwide rate be if it was based on machine hours instead of labor hours?

a.$24.34 per machine hour

b.$8.46 per machine hour

c.$10.58 per machine hour

d.$13.23 per machine hour

4.

The Dawson Company manufactures small lamps and desk lamps. The following shows the activities per product and the total overhead information:

	Setups	Inspections	Assembly (dlh)
Small Lamps - 4,300 units	3,200	9,450	44,800
Desk Lamps - 8,200 units	6,400	15,750	44,800

Activity Pool	Activity Base	Budgeted Amount
Setups	9,600	$102,720
Inspections	25,200	$138,600
Assembly (dlh)	78,400	$243,040

Calculate the overhead per unit to be charged to small lamps.

a.$68.06

b.$31.41

c.$52.35

d.$89.00

8. Panamint Systems Corporation is estimating activity costs associated with producing disk drives, tapes drives, and wire drives. The indirect labor can be traced to four separate activity pools. The budgeted activity cost and activity base data by product are provided below.

				Activity Cost							Activity Base
Procurement				$349,200							Number of purchase orders
Scheduling				$228,500							Number of production orders
Materials handling				$482,400							Number of moves
Product development				$742,600							Number of engineering changes
Production				$1,457,900							Machine hours
	Number of Purchase Orders			Number of Production Orders				Number of Moves			Number of Engineering Changes				Machine Hours			Number of Units
Disk drives	3,830			250				1,330			12				1,800			1,800
Tape drives	1,700			165				690			6				8,400			4,200
Wire drives	11,400			990				4,500			22				11,200			2,200

Determine the activity-based cost for each disk drive unit.

a.$20.63

b.$189.68

c.$313.05

d.$863.92