7T-3

Chipman Inc. produces water pumps. Overhead costs have been identified as follows: Activity Pool Cost Material handling $ 73,237.50 Machine maintenance $110,700.00 Setups $ 78,687.00 Activity Driver Number of moves Number of machine hours Number of production runs Activity 465 36,900 63 Chipman makes 3 models of pumps with the following details: Economy Standard Premium Units produced 10,060 22,000 565 Number of moves 162 130 173 Machine hours 9,300 20,100 7,500 Production runs 20 14 29 Required: a. Calculate the activity rate for each activity. (Round your answers to 2 decimal places.) Activity Rate Activity Pool Material Handling Machine Maintenance Setups b. Determine the amount of indirect costs assigned to each of the products. (Do not round your intermediate calculations. Round your answers to 2 decimal places.) Cost Models Economy Standard Premium