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Exercise 4-5 Assigning Overhead to Products in ABC [LO4-2, L04-3) Sultan Company uses an activity-based costing system. At the beginning of the year, the company
Exercise 4-5 Assigning Overhead to Products in ABC [LO4-2, L04-3) Sultan Company uses an activity-based costing system. At the beginning of the year, the company made the following estimates of cost and activity for its five activity cost pools: Activity Cost Pool Labor-related Purchase orders Parts management Board etching General factory Activity Mature Direct labor-hours Number of orders Number of part types Number of boards Machine-hours Expected Overhead Cont $ 311,500 $ 8,840 $ 71,280 $ 63,700 $ 148,000 Expected Activity 44.500 DHS 221 orders 99 part types 1,820 boards 14, 800 MHS Required: 1. Compute the activity rate for each of the activity cost pools. 2. The expected activity for the year was distributed among the company's four products as follows: Expected Activity Activity Cost Pool Product Product Product C Product D Labor-related (DLHS) 6,800 27,300 4,600 5,800 Purchase orders (orders) 51 49 92 Parts management (part types) 34 17 33 15 Board etching boards) 500 770 550 General factory (MS) 2,100 6,300 2,400 4,000 29 0 Using the ABC data, determine the total amount of overhead cost assigned to each product
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