1. DEF Automotive

Scenario: Activity-Based Costing

Data:

• Total Overhead Costs: $600,000
• Machine Hours: 10,000
• Direct Labor Hours: 8,000
• Units Produced: 5,000

Requirements:

1. Allocate overhead costs using activity-based costing.
2. Calculate the overhead cost per unit.
3. Evaluate the effectiveness of activity-based costing in cost control.
4. Suggest improvements for more accurate overhead allocation.