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Barnett Products manufactures three types of remote-control devices: Economy, Standard, and Deluxe. The company, which uses activity-based costing. has identified five activities (and related
Barnett Products manufactures three types of remote-control devices: Economy, Standard, and Deluxe. The company, which uses activity-based costing. has identified five activities (and related cost drivers). Each activity, its budgeted cost, and related cost driver is identified below. Activity Cost Material handling $ 238,000 Cost Driver Material insertion Automated machinery Finishing Packaging Total Number of parts 2,600,000 Number of parts 875,000 Machine hours 183,000 Direct labor hours 183,000 Orders shipped $4,079,000 The following information pertains to the three product lines for next year Units to be produced Economy Standard 19,600 Deluxe 7,600 2,450 orders to be shipped 1,910 880 230 Number of parts per unit. 15 20 25 Machine hours per unit Labor hours per unit What is Barnett's pool rate for the material-handling activity? 1 3 5 2 2 2
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