Question
Direct Labor-Hours Annual Production Hubs. Sprockets 11,000 units 55,000 units per Unit 0.60 0.20 Additional information about the company follows: a. Hubs require $37
Direct Labor-Hours Annual Production Hubs. Sprockets 11,000 units 55,000 units per Unit 0.60 0.20 Additional information about the company follows: a. Hubs require $37 in direct materials per unit, and Sprockets require $11. b. The direct labor wage rate is $11 per hour. c. Hubs require special equipment and are more complex to manufacture than Sprockets. d. The ABC system has the following activity cost pools: Estimated Overhead. Activity Cost Pool (Activity Measure) Machine setups (number of setups) Special processing (machine-hours) General factory (orpanization-sustaining) Required: Cost $ 34,020 Hubs Activity Sprockets Total 140 112 $ 253,000 4,600 0 252 4,600 $ 204,600 NA NA NA 1. Compute the activity rate for each activity cost pool. 2. Determine the unit product cost of each product according to the ABC system. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the activity rate for each activity cost pool. Activity Cost Pool Machine setups Special processing Activity Rate per setup per MH
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