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Farragut Company uses ABC to account for its chrome wheel manufacturing process. Company managers have identified four manufacturing activities that incur manufacturing overhead costs:
Farragut Company uses ABC to account for its chrome wheel manufacturing process. Company managers have identified four manufacturing activities that incur manufacturing overhead costs: materials handling, machine setup, insertion of parts, and finishing. The budgeted activity costs for the upcoming year and their allocation bases are as follows: (Click the icon to view the data.) Farragut Compagy expects to produce 1,000 chrome wheels during the year. The wheels are expected to use 3,000 parts, require 10 setups, and consume 1,500 hours of finishing time. (Click the icon for completed job data) Read the requirements Requirement 1. Compute the cost allocation rate for each activity. First identify the formula, then compute the rate for each activity. Total activity overhead (ost) Mat handling $ 9,000 Mach setup $ 3,500 Insertion $ 45,000 78,000 Total activity allocation base Activity cost alocation rate 3,000 = $ 3 10 per part $ 350 er setup 3,000 S 15 per part 1,500 52 per hour Finishing Requirement 2. Compute the manufacturing overhead cost that should be assigned to Job 420, Activity Materials handing MOH Cost 900 Clear all Check answer Farragut Company uses ABC to account for its chrome wheel manufacturing process. Company managers have identified four manufacturing activities that incur manufacturing overhead costs: materials handling, machine setup, insertion of parts, and finishing. The budgeted activity costs for the upcoming year and their allocation bases are as follows: (Click the icon to view the data.) Farragut Company expects to produce 1,000 chrome wheels during the year. The wheels are expected to use 3,000 parts, require 10 setups, and consume 1,500 hours of finishing time (Click the icon for completed job data) Read the requirements Insertion of parts Finishing Total 4,500 6,240 12.690 Requirement 3. Compute the manufacturing overhead cost that should be assigned to Job 510. Activity Materials handling Machine setup Insertion of parts Finishing Total Get more help MOH Cost O Search D @ B Clear all Check answer 219 PM 2/5/2023 a More info Job 420 used 300 parts, required 3 setups, and consumed 120 finishing hours. Job 510 used 500 parts, required 5 setups, and consumed 330 finishing hours. Print Done - p Data table Total Budgeted Manufacturing Activity Overhead Cost Allocation Base Materials handling. $ 9,000 Number of parts Machine setup Insertion of parts 3,500 Number of setups 45,000 Number of parts 78,000 Finishing... Finishing direct labor hours $ 135,500 Total... Print Done
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