Calculating Activity-Based Costing Overhead Rates Assume that manufacturing overhead for Glassman Company consisted of the following activities and costs:

Setup (1,000 setup hours)	$164,000
Production scheduling (400 batches)	80,000
Production engineering (60 change orders)	120,000
Supervision (2,000 direct labor hours)	56,000
Machine maintenance (12,000 machine hours)	84,000
Total activity costs	$504,000

The following additional data were provided for Job 845

Direct materials costs	$12,000
Direct labor cost (5 Milling direct labor hours;
35 Finishing direct labor hours)	$6,000
Setup hours	5 hours
Production scheduling	1 batch
Machine hours used (25 Milling machine hours;
5 Finishing machine hours)	30 hours
Production engineering	3 change orders

a. Calculate the cost per unit of activity driver for each activity cost category.

Setup	Answer
Production scheduling cost	Answer
Production engineering cost	Answer
Supervision cost	Answer
Machine operating cost	Answer

b. Calculate the cost of Job 845 using ABC to assign the overhead costs.

Job 845
Direct materials cost	Answer
Direct labor cost	Answer
Manufacturing overhead costs:
Setup costs	Answer
Production scheduling	Answer
Production engineering	Answer
Supervision	Answer
Machine operations	Answer
Total cost	Answer

c. Calculate the cost of Job 845 using a company-wide overhead rate based on machine hours.

First, compute company-wide overhead rate using machine hours (Note: Information needed for this computation can be found in the table below in part d.) Round rate to two decimal places. $Answer

per machine hour Next, use rounded overhead rate calculated above for calculations below. Round cost answers to the nearest whole number, when needed.

Job 845
Direct materials cost	Answer
Direct labor cost	Answer
Manufacturing overhead cost:	Answer
Total cost	Answer

d. Calculate the cost of Job 845 using a machine hour departmental overhead rate for the Milling Department and a direct labor hour overhead rate for the Finishing Department.

Milling Department manufacturing overhead	$364,000
Finishing Department manufacturing overhead	$140,000
Machine hours used
Milling Department	10,000 hours
Finishing Department	2,000 hours
Labor hours used
Milling Department	1,000 hours
Finishing Department	1,000 hours

Round rates to two decimal places, if needed. $Answer

per Milling Dept. machine hour $Answer

per Finishing Dept. direct labor hour

Use rounded overhead rates calculated above for calculations below. Round cost answers to the nearest whole number, when needed.

Job 845
Direct materials cost	Answer
Direct labor cost	Answer
Manufacturing overhead costs:
Milling Department	Answer
Finishing Department	Answer
Total cost	Answer