Question
Comfort Corporation manufactures two models of office chairs, a standard and a deluxe model. The following activity and cost information has been compiled: Activity Overhead
Comfort Corporation manufactures two models of office chairs, a standard and a deluxe model. The following activity and cost information has been compiled:
| Activity | Overhead cost | Cost driver | Standard | Deluxe |
| Setup | $52,000 | # of setup | 12 setups | 28 setups |
| Inspection | $78,000 | # of inspection | 8 inspection | 12 inspection |
| Total manufacturing overhead | $130,000 |
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| Product | Direct Labor Hours |
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| Standard | 255 |
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| Deluxe | 245 |
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Number of setups and number of inspections are identified as activity-cost drivers for overhead. Assuming an activity-based costing system is used, what is the total amount of overhead costs assigned to the deluxe model?
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Accounting
Authors: Charles T. Horngren, Walter T. Harrison, Linda S. Bamber, Betsy Willis, Becky Jones
5th Edition
0130906999, 978-0130906991
