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a. Determine the activity rate for each activity. If required, round the rate to the nearest dollar Activity Rates and Product Costs using Activity-Based Costing
a. Determine the activity rate for each activity. If required, round the rate to the nearest dollar
Activity Rates and Product Costs using Activity-Based Costing Lonsdale 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 handling Budgeted Activity Cost $339,660 193,630 38,360 44,700 48,020 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 Machine hours Direct labor hours Number of inspections Number of setups Number of loads units produced Entry 5,290 4,560 2,080 240 770 10,600 Dining 4,700 6,830 660 60 210 5,300 Total 9,990 11,390 2,740 300 980 15,900 a. Determine the activity rate for each activity. If required, round the rate to the nearest dollar. Activity Casting Assembly Inspecting Setup Materials handling Activity Rate per machine hour per direct labor hour per inspection per setup per load b. use the activity rates in (a) to determine the total and per-unit activity costs associated with each product. Round the per unit amounts to the nearest cent. Product Entry Lighting Fixtures Dining Room Lighting Fixtures Total Activity Cost Activity Cost Per unit
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