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 Assembly Inspecting Setup Materials handling Budgeted Activity Cost Activity Base $305,920 Machine hours 185,300. Direct labor hours 27,160 Number of inspections 54,760 Number of setups 44,550 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 an units produced follow: Entry Dining Total Activity Base Machine hours 5,070 4,490 9,560 Direct labor hours 4,360 6,540 10,900 Number of inspections 1,470 470 1,940 Number of setups 300 70 370 Number of loads 780 210 990 Units produced 10,000 5,000 15,000
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