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7. Garfield Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and their associated budgeted activity
7. Garfield Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and their associated budgeted activity costs and activity bases are as follows: Activity Casting Assembly Inspecting Setup Materials Budgeted Activity Cost $650,000 85,000 28,000 15,750 12,000 Activity Base Machine hours Direct labor hours Number of inspections Number of setups Number of loads Corporate records were obtained to estimate the amount of activity to be used by the two products. The estimated activity-base usage quantities and units produced follow: Activity Base Casting Assembly Inspecting Setup Materials Units produced Entry 7,500 2,000 500 150 400 5,000 Dining 12,500 3,000 250 Total 20,000 5,000 750 250 700 7,500 100 300 2,500 a. Determine the activity rate for each activity. b. Use the activity rates in (a) to determine the total and per-unit activity costs associated with each product
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