Activity-Based Costing: Factory Overhead Costs

The total factory overhead for Bardot Marine Company is budgeted for the year at $864,600, divided into four activities: fabrication, $392,000; assembly, $180,000; setup, $159,600; and inspection, $133,000. 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	7,000	dlh	22,500	dlh	50	setups	88	inspections
Bass boat	21,000		7,500		370		612
	28,000	dlh	30,000	dlh	420	setups	700	inspections

Each product is budgeted for 4,000 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