Activity-Based Costing Steampunk Corporation has the following predicted indirect costs and cost drivers for 2019 for the given activity cost pools: Fabrication Finishing Department Department Cost Driver Machine Maintenance $ 84,000 42,000 hours Materials Material handling 126,000 63,000 moves Machine Machine 294,000 21,000 setups Inspection Inspections 105,000 hours Total $ 504,000 $ 231,000 The following activity predictions were also made for the year: Fabrication Finishing Department Department Machine hours 5,000 2.500 Material moves 1,500 750 Machine setups Inspection hours 350 25 500 It is assumed that the cost per unit of activity for a given activity does not vary between departments. Steampunk's president, Abner Punk, is trying to evaluate the company's produc mix strategy regarding two of its product models, SW100 and SG150. The company has been using a company wide overhead rate based on machine hours but is considering switchi to either department rates of activity-based rates. The production manager has provided the following data for the production of a batch of 100 units for each of these models: SW100 SG150 Direct materials $ 28,000 $ 42,000 cost Direct labor cost $ 11,200 $ 8,400 Machine hours 250 350 100 50 (Fabrication) Machine hours (Finishing) Materials moves Machine setups Inspection hours 20 40 5 10 15 30 a. Determine the cost of one unit each of SW100 and SG150, assuming a company-wide overhead rate is used based on total machine hours. Round rate to two decimal places. Overhead rate based on total machine hours: $ per machine hour Use rounded overhead rate calculated about for calculations below. Round cost answers to the nearest whole number. Round cost per unit to two decimal places. Product Costs per Unit SW100 SG150 Direct materials $ Direct labor Manufacturing overhead Total cost per batch $ $ Number of units per batch Cost per unit $ b. Determine the cost of one unit of SW100 and SG150, assuming department overhead rates are used. Overhead is assigned based on machine hours in both departments. Round to two decimal places, if applicable. Overhead rate based on machine hours for Fabrication Dept.: $ per machine hour. Overhead rate based on machine hours for Finishing Dept.: $ per machine hour. Use rounded overhead rate calculated above for calculations below. Round cost answers to the nearest whole number, when needed. Round cost per unit to two decimal places, if needed. SW100 SG150 $ $ Product Costs per Unit Direct materials Direct labor Manufacturing overhead: Fabrication Dept. Finishing Dept. Total cost per batch Number of units per batch Cost per unit $ $ $ c. Determine the cost of one unit of SW100 and SG150, assuming activity-based overhead rates are used for maintenance, materials handling, machine setup, and inspection activities. Round rate to two decimal places, if applicable. Activity-based overhead rates: Maintenance Materials handling $ Machine setup $ Inspection activities $ Use rounded overhead rate calculated above for calculations below. Round cost answers to the nearest whole number, when needed. Round cost per unit to two decimal places, if needed. SW100 SG150 Product Costs per Unit Direct materials Direct labor Manufacturing overhead: Maintenance activity Materials handling activity Machine setups activity Inspections activity Total cost per batch Number of units per batch Cost per unit $
