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Chapter 4 In-Class Problem Glass Company manufactures two types of wine glasses that are sold in sets of four; Regular Glass and Fine Crystal Glass

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Chapter 4 In-Class Problem Glass Company manufactures two types of wine glasses that are sold in sets of four; Regular Glass and Fine Crystal Glass Company uses activity based costing to assign manufacturing overhead to products and have identified the following activity cost pools and activity measures related to the current period's $250,000 manufacturing overhead: Activity Activity Measure Total Cost Machine processing of glasses Machine hours $ 90,000 Product testing Hours of testing time $ 20,000 Processing production orders Number of orders $ 35,000 General factory costs Direct labor hours $105.000 Total MOH $250,000 Activity for each of the products is: Regular Glass Machine Hours 30,000 Hours of testing 2,000 Number of orders 5,000 Direct labor hours 25,000 Fine Crystal 50,000 5,000 2.000 10,000 Total 80,000 7,000 7,000 35,000 Classify each of Glass Company's overhead activities as either unit level, batch level, product level, or facility level activity. Machine hours_Unit-level Processing production orders atch-level Product testing_product-level General factory costs_ facititu -level Compute the activity rate for each of the four activities listed. Machine processing Product testing Processing orders General factory 1.125 2.86 3. Compute total overhead assigned to Fine Crystal 50.000 x 1.125 = 56250 5000 x 2.86 - 14300 = 83550 2000 * 5 = 10000 10000 X3 = 3000 Compute per unit overhead assigned to Fine Crystal, assuming 3,000 units of Fine Crystal were manufactured during the current period. 83550 = 27.85 $27.85 3000

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