Activity-Based Costing: Factory Overhead Costs

The total factory overhead for Bardot Marine Company is budgeted for the year at $726,000, divided into four activity pools: fabrication,, $352,000; assembly, $132,000; setup, $132,000; and inspection, $110,000. Bardot Marine manufactures two types of boats: speedboats and bass boats. The activity-base usage quantities for each product by each activity are as follows:

	Fabrication		Assembly		Setup		Inspection
Speedboat	5,500	dlh	16,500	dlh	40	setups	69	inspections
Bass boat	16,500		5,500		290		481
	22,000	dlh	22,000	dlh	330	setups	550	inspections

Each product is budgeted for 3,500 units of production for the year.

a. Determine the activity rates for each activity.

Fabrication	$ per direct labor hour
Assembly	$ per direct labor hour
Setup	$ per setup
Inspection	$ per inspection

b. Determine the activity-based factory overhead per unit for each product. Round to the nearest whole dollar.

Speedboat	$ per unit
Bass boat	$ per unit