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Approximately Relevant ABC Silven Company has identified the following overhead activities, costs, and activity drivers for the coming year: Activity Expected Cost Activity Driver Activity

Approximately Relevant ABC

Silven Company has identified the following overhead activities, costs, and activity drivers for the coming year:

Activity Expected Cost Activity Driver Activity Capacity
Setting up equipment $135,000 Number of setups 120
Ordering materials 10,800 Number of orders 600
Machining 119,000 Machine hours 11,900
Receiving 19,200 Receiving hours 960

Silven produces two models of cell phones with the following expected activity demands:

Model X Model Y
Units completed 4,300 8,600
Number of setups 80 40
Number of orders 200 400
Machine hours 6,800 5,100
Receiving hours 320 640

Required:

1. Determine the total overhead assigned to each product using the four activity drivers.

Total Overhead Assigned
Model X $
Model Y $

2. Determine the total overhead assigned to each model using the two most expensive activities. The costs of the two relatively inexpensive activities are allocated to the two expensive activities in proportion to their costs. Round interim calculations to two decimal places and round your final answers to the nearest dollar.

Total Overhead Assigned
Model X $
Model Y $

3. Using ABC as the benchmark, calculate the percentage error. Round your answers to two decimal places.

Percentage Error
Model X %
Model Y %

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