34 After reading an article about activity-based costing in a trade journal for the furniture industry, Santana Rey decides to analyze overhead cost at Business Solutions. In a recent month, Santana found that setup costs, inspection costs, and utility costs made up most of the company's overhead. Additional information about overhead follows. Activity Set up Inspection Utilities Total Budgeted Cost $ 16,170 4,800 9,600 $ 30,570 The following data pertain to Job 615. Direct materials Direct labor Overhead Setups Parts inspected Machine hours Required: $ 2,800 $3,500 Budgeted Activity Usage 21 setups 4,800 parts inspected 4,800 machine hours (MH) 2 setups 400 parts inspected 540 machine hours 1. Classify each of the three overhead activities as unit level, batch level, product level, or facility level. 2. Assume Business Solutions allocates overhead cost using a plantwide rate based on 4,800 machine hours. Compute total product cost of Job 615. 3. Assume Business Solutions uses activity-based costing. (a) Compute overhead activity rates. (b) Allocate overhead cost to Job 615. (c) Compute total product cost of Job 615. Required 1 Required 2 Required 3 Classify each of the three overhead activities as unit level, batch level, product level, or facility level. Setup Batch level Utilities Total 9,600 $ 30,570 The following data pertain to Job 615. Direct materials Direct labor Overhead Setups $ 2,800 4,800 machine hours (MH) $ 3,500 2 setups 400 parts inspected $ 7 Parts inspected Machine hours Required: 540 machine hours 1. Classify each of the three overhead activities as unit level, batch level, product level, or facility level. 2. Assume Business Solutions allocates overhead cost using a plantwide rate based on 4,800 machine hours. Compute total product cost of Job 615. 3. Assume Business Solutions uses activity-based costing. (a) Compute overhead activity rates. (b) Allocate overhead cost to Job 615. (c) Compute total product cost of Job 615. Required 1 Required 2 Required 3 Classify each of the three overhead activities as unit level, batch level, product level, or facility level. Setup Inspection Utilities Batch level Unit level Facility level Required 1 Required 2 > Required: 1. Classify each of the three overhead activities as unit level, batch level, product level, or facility level. 2. Assume Business Solutions allocates overhead cost using a plantwide rate based on 4,800 machine hours. Compute total product cost of Job 615. 3. Assume Business Solutions uses activity-based costing. (a) Compute overhead activity rates. (b) Allocate overhead cost to Job 615. (c) Compute total product cost of Job 615. Required 1 Required 2 Required 3 Assume Business Solutions allocates overhead cost using a plantwide rate based on 4,800 machine hours. Compute total product cost of Job 615. (Do not round intermediate calculations. Round "Overhead rate" to 2 decimal places. Round other answers to nearest whole number.) Allocate overhead to Job 615 using plantwide rate Department Job 615 Plantwide Overhead Rate Machine Hours Used I Overhead Allocated Total product cost of Job 615 Job 615 Direct Materials Direct Labor Overhead Product Cost < Required 1 Required 3> Required 1 Required 2 Required 3 Assume Business Solutions uses activity-based costing. (a) Compute overhead activity rates. (b) Allocate overhead cost to Job 615. (c) Compute total product cost of Job 615. (Round "Activity Rate" to 2 decimal places.) a. Compute overhead activity rates Setup Activity Activity Rate per setup Inspection per part Utilities per MH b. Allocate overhead to Job 615 based on actual activity usage. Activity Setup Inspection Allocated Cost Utilities Total allocated cost $ c. Total product cost of Job 615 based on activity-based costing Direct Materials Job 615 Direct Labor Overhead Product Cost $ < Required 2 Required 3