Question
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
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 Budgeted Activity Cost Activity Base Assembly Inspecting Setup: $244,750 Machine hours 178,560 Direct labor hours 35,230 Number of inspections 35,910 Number of setups 42,640 Number of loads Materials handling 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 Entry Dining Total Machine hours 5,190 4,600 9,790 Direct labor hours 4,460 6,700 11,160) Number of inspections 2,060 650 2,710 Number of setups 21 50 270 Number of loads 820 220 1,040 Units produced 10,400 5,200 15,600 a. Determine the activity rate for each activity. If required, round the rate to the nearest dollar.
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