Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Everlast Co. manufactures a variety of drill bits. The company's plant is partially automated. The budget for the year includes $660,000 payroll for 8,600 direct
Everlast Co. manufactures a variety of drill bits. The company's plant is partially automated. The budget for the year includes $660,000 payroll for 8,600 direct labor-hours. Listed below is cost driver information used in the product-costing system:
Overhead Cost Pool | Budgeted Overhead | Cost Driver | Estimated Cost Driver Level | ||||
Machine setups | $ | 310,000 | # of setups | 310 | setups | ||
Materials handling | 115,800 | # of barrels | 9,650 | barrels | |||
Quality control | 1,290,000 | # of inspections | 3,000 | inspections | |||
Other overhead cost | 1,075,000 | # of machine hours | 21,500 | machine hours | |||
Total overhead | $ | 2,790,800 | |||||
A current product order has the following requirements:
Machine setups | 28 | setups |
Materials handling | 720 | barrels |
Quality inspections | 90 | inspections |
Machine hours | 1,700 | machine hours |
Direct labor hour | 564 | hours |
Using ABC, how much total overhead is assigned to the order?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started