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: Budgeted Activity Cost Activity Base Activity: Casting Assembly Inspecting Setup $349,520 Machine hours 187,520 Direct labor hours 33,020 Number of inspections 44,400 42,900 Number of setups 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 5,450 4,830 10,280 Direct labor hours 4,690 7,030 11,720 Number of inspections 1,930 610 2,540 Number of setups 240 60 3001 Number of loads 870 230 1,100 Units produced 10,800 5,400 16,200 a. Determine the activity rate for each activity. If required, round the rate to the nearest dollar. Activity Activity Rate
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