Question
Coronado Machining makes three products. The companys annual budget includes $1,066,200 of overhead. In the past, the company allocated overhead based on expected capacity of
Coronado Machining makes three products. The companys annual budget includes $1,066,200 of overhead. In the past, the company allocated overhead based on expected capacity of 42,648 direct labor hours. The company recently implemented an activity-based costing system and has determined that overhead costs can be broken into four overhead pools: order processing, setups, milling, and shipping. The following is a summary of company information: Expected Cost Expected Activities Order processing $ 213,200 13,000 orders Setups 168,000 4,000 setups Milling 430,000 20,000 machine hours Shipping 255,000 25,000 shipments $ 1,066,200
Calculate the companys traditional overhead rate based on direct labor hours.
A overhead rate $________/DLH
Order processing _____ per order
setups $________ per setup
Milling $______ per machine hours
Shipping $______per shipment
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