Activity Rates and Product Costs Using Activity-Based Costing

BriteLite Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and their associated activity costs and activity bases are as follows:

Activity	Activity Costs (Budgeted)		Activity Base
Casting	$42,000		Machine hours
Assembly	13,500		Direct labor hours
Inspecting	5,800		Number of inspections
Setup	16,800		Number of setups
Materials handling	3,600		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 for each product and in total are provided in the following table:

Activity Base		Entry		Dining		Total
Machine hours		800		600		1400
Direct labor hours		500		400		900
Number of inspections		140		150		290
Number of setups		80		60		140
Number of loads		50		40		90
Units produced		1,200		500		1,700

a. Determine the activity rate for each activity.

Activity	Activity Rate
Casting	$fill in the blank 1	mh
Assembly	$fill in the blank 2	dlh
Inspecting	$fill in the blank 3	/insp.
Setup	$fill in the blank 4	/setup
Materials handling	$fill in the blank 5	/load

b. Use the activity rates in (a) to determine the total and per-unit activity costs associated with each product. If required, round your answers to two decimal places.

	Entry Lighting Fixtures			Dining Room Lighting Fixtures
Casting	$fill in the blank 6			$fill in the blank 7
Assembly	fill in the blank 8			fill in the blank 9
Inspecting	fill in the blank 10			fill in the blank 11
Setup	fill in the blank 12			fill in the blank 13
Materials handling	fill in the blank 14			fill in the blank 15
Total activity cost	$fill in the blank 16			$fill in the blank 17
Number of units	fill in the blank 18			fill in the blank 19
Activity cost per unit	$fill in the blank 20			$fill in the blank 21