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3. The controller of Scenic Photographic Supply Company has established the following overhead cost pools and cost drivers. Estimated Level for Pool Rates Overhead
3. The controller of Scenic Photographic Supply Company has established the following overhead cost pools and cost drivers. Estimated Level for Pool Rates Overhead Cost Pool Estimated Overhead Cost Machine Setups $ 100,000 Cost Driver Number of setups Cost Driver 100 setups Material Handling 50,000 Weight of raw material 50,000 pounds Hazardous waste control Quality control inspection Other overhead costs 100,000 Machine hours $312,500 25,000 Weight of hazardous chemicals used 37,500 Number of inspections 10,000 pounds 1,000 inspections 20,000 MH Total An order for 1,000 boxes of film development chemicals (order NX) has the following production requirements. Machine setups Raw material 4 setups 10,000 pounds Hazardous material 2,000 pounds 10 inspections 500 machine hours Inspections Machine hours Required: a. Compute the total overhead cost that should be assigned to the development-chemical order, using the five cost pools and drivers. b. What is the overhead cost per box of chemicals? c. Suppose Scenic Photographic Supply Company were to use a single, predetermined overhead rate based on machine hours. Compute the rate per hour and the total overhead assigned to the order above.
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