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Foam Products, Inc, makes foam seat cushions for the automotive and aerospace industries. The company's activity-based costing system has four activity cost pools, which are
Foam Products, Inc, makes foam seat cushions for the automotive and aerospace industries. The company's activity-based costing system has four activity cost pools, which are listed below along with their activity measures and activity rates: Activity Neasure Activity Rate Supporting direct labor Batch processing Order processing Custoner service Sumber of direct labor-hours Sunber of batches Sumber of orders Sumber of customers 9 per direct labor-hour 91 per batch 274 per order s 2,626 per customer The company just completed a single order from Interstate Trucking for 2,600 custom seat cushions. The order was produced in two batches. Each seat cushion required 0.4 direct labor-hours. The selling price was $142.10 per unit, the direct materials cost was $105 per unit, and the direct labor cost was $14.80 per unit. This was Interstate Trucking's only order during the year
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