Question
Activity-Based Costing Maritime Marine Company has total estimated factory overhead for the year of $918,200, divided into four activities: fabrication, $377,000; assembly, $187,200; setup, $144,000;
Activity-Based Costing
Maritime Marine Company has total estimated factory overhead for the year of $918,200, divided into four activities: fabrication, $377,000; assembly, $187,200; setup, $144,000; and inspection, $210,000. Maritime 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 | 800 | dlh | 1,700 | dlh | 40 | setups | 120 | inspections |
Bass boat | 2,100 | 700 | 110 | 300 | ||||
2,900 | dlh | 2,400 | dlh | 150 | setups | 420 | 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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