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Adria Company recently implemented an activity-based costing system. At the beginning of the year, management made the following estimates of cost and activity in the

Adria Company recently implemented an activity-based costing system. At the beginning of the year, management made the following estimates of cost and activity in the company's four activity cost pools: Activity Cost Pool Activity Measure Labor-related Direct labor-hours Purchase orders Relay assembly General factory Number of orders Number of relays Machine hours Activity Cost Pools Labor Related Production orders Expected Overhead Cost Relay Assembly General Factory $36,000 $5,000 $4,000 $2,50,000 3a. Compute the activity rate for each of the activity cost pools. (10 points) Expected Expected Overhead Cost Activity Expected Activity 9,000 2,000 1,000 50,000 Activity Rate The expected activity for product B was 400 direct labor-hours, 300 production orders, 150 relay assemblies, and 6,000 machine hours. per direct labor-hour per order per relay per machine-hour
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Adria Company recently implemented an activity-based costing system. At the beginning of the year, management made the following estimates of cost and activity in the company's four activity cost pools: 3a. Compute the activity rate for each of the activity cost pools. (10 points) The expected activity for product B was 400 direct labor-hours, 300 production orders, 150 relay assemblies, and 6,000 machine hours. 3a. Compute the activity rate for each of the activity cost pools. ( 10 points) \begin{tabular}{|c|c|c|c|c|} \hline & Expected & Expected & Activity & \\ \hline Activity Cost Pools & Overhead Cost & Activity & Rafe & \\ \hline Labor Related & & & & per direct labor-hour \\ \hline Production orders & & & & per order \\ \hline Relay Assembly & & & & per relay \\ \hline General Factory & & & & per machine-hour \\ \hline \end{tabular} The expected activity for product B was 400 direct labor-hours, 300 production orders, 150 relay assemblies, and 6,000 machine hours. 3b. Calculate the applied overhead for product B. (10 points) \begin{tabular}{|l|l|l|l|} & Activity & Expected & Applied \\ \hline Activity cost pool & Rate & Activity & Overhead \\ \hline Labor Related & & direct labor-hours & \\ \hline Production orders & & orders & \\ Relay Assembly & & relays & \\ General Factory & & machine-hours & \\ & & & \end{tabular}

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