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29.5 Questions The 'other' activity cost pool consists of idle capacity and organization sustaining costs. The company traces the Comfort Fabricating Company uses activity-based costing.

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29.5 Questions The 'other' activity cost pool consists of idle capacity and organization sustaining costs. The company traces the Comfort Fabricating Company uses activity-based costing. costs of direct materials and direct labour to job. The company has four activity cost pools which are listed Overhead costs both manufacturing and non- below: manufacturing are allocated to jobs using the ABC system. The company's overhead costs for the year are Activity cost pool Annual activity listed below: Producing units 8000 machine hours Annual overhead costs Processing orders 2000 orders Indirect factory wages 300 000 Customer support 500 customers Other factory overhead 400 000 Other Not applicable Selling and administrative overhead 500 000 1200 000 278 Costing SystemsThe four activity cost pools are Other Producing Processing Customer Total Indirect factory wages units orders 104% support 404% Other factory overhead 409% 10% 1004% 30% 304% Nil 1004% Selling and administrative overhead 309% Nil 304% 40% 1004% Required (a) Compute the first-stage collection of costs to the activity cost pools. (b) Compute activity rates for each of the activity pools. (c) Compare the total amount of overhead cost that would be allocated to an order that requires 25 machine hours

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