Question
Cost Cost driver Unit Level Activities Batch Level $ 19,000 1,800 labor hours 38 setups $ 50,400 Product Level $ 19,000 Percentage of use
Cost Cost driver Unit Level Activities Batch Level $ 19,000 1,800 labor hours 38 setups $ 50,400 Product Level $ 19,000 Percentage of use Facility Level $140,000 10,000 units Production of 780 sets of cutting shears, one of the company's 20 products, took 210 labor hours and 7 setups and consumed 17 percent of the product-sustaining activities. Required a. Had the company used labor hours as a companywide allocation base, how much overhead would it have allocated to the cutting shears? b. How much overhead is allocated to the cutting shears using activity-based costing? c. Compute the overhead cost per unit for cutting shears first using activity-based costing and then using direct labor hours for allocation if 780 units are produced. If direct product costs are $170 and the product is priced at 30 percent above cost for what price would the product sell under each allocation system? Complete this question by entering your answers in the tabs below. Req A and B Req C
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