Question
Activity-Based Costing Mainline Marine Company has total estimated factory overhead for the year of $1,023,700, divided into four activities: fabrication, $475,200; assembly, $202,800; setup, $109,200;
Activity-Based Costing
Mainline Marine Company has total estimated factory overhead for the year of $1,023,700, divided into four activities: fabrication, $475,200; assembly, $202,800; setup, $109,200; and inspection, $236,500. Mainline manufactures two types of boats: a speedboat and a bass boat. The activity-base usage quantities for each product by each activity are as follows:
| Fabrication | Assembly | Setup | Inspection | |||||
| Speedboat | 1,100 | dlh | 1,400 | dlh | 40 | setups | 80 | inspections |
| Bass boat | 2,200 | 1,200 | 90 | 350 | ||||
| 3,300 | dlh | 2,600 | dlh | 130 | setups | 430 | inspections | |
Each product is budgeted for 200 units of production for the year.
a. Determine the activity rates for each activity.
| Fabrication | $ per dlh |
| Assembly | $ per dlh |
| Setup | $ per setup |
| Inspection | $ per inspection |
b. Determine the factory overhead cost per unit for each product, using activity-based costing. If required, round to the nearest cent.
| Speedboat | $ |
| Bass boat | $ |
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Intermediate Accounting Volume 1
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Irene M. Wiecek, Bruce J. McConomy
12th Canadian edition
978-1119496496
