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Farrington Company uses ABC to account for its chrome wheel manufacturing process. Company managers have identified four manufacturing activities that incur manufacturing overhead costs
Farrington Company uses ABC to account for its chrome wheel manufacturing process. Company managers have identified four manufacturing activities that incur manufacturing overhead costs materials handing 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) Farmington Company expects to produce 1,000 chrome wheels during the year. N wheels are expected to use 3,000 parts, require 10 setups, and consume 2,000 hours of finishing time (Click the icon for completed job data) Data table Total Budgeted Manufacturing - X ute the rate for each activity More info Activity Overhead Cost Allocation Base Materials handling.... $ 12.000 Number of parts Machine setup Insertion of parts 3.400 Number of setup Finishing- Total $ 40,000 Number of parts 80.000 Finishing direct labor hours 143,400 Job 420 used 200 parts, required 2 setups, and consumed 140 finishing hours Job 510 used 425 parts, required 4 setups, and consumed 300 finishing hours Print Done Print Done X
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