Activity-Based Costing: Factory Overhead Costs

The total factory overhead for Bardot Marine Company is budgeted for the year at $1,344,900, divided into four activities: fabrication, $672,000; assembly, $234,000; setup, $239,400; and inspection, $199,500. 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:

FabricationAssemblySetupInspection

Speedboat10,500dlh29,250dlh76setups131inspections

Bass boat31,500 9,750 554 919

42,000dlh39,000dlh630setups1,050inspections

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