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Fogerty Company makes two products-titanium Hubs and Sprockets. Data regarding the two products follow: Hubs Sprockets Direct Labor-Hours per Unit 0.60 0.20 Annual Production
Fogerty Company makes two products-titanium Hubs and Sprockets. Data regarding the two products follow: Hubs Sprockets Direct Labor-Hours per Unit 0.60 0.20 Annual Production 21,000 units 55,000 units Additional information about the company follows: a. Hubs require $37 in direct materials per unit, and Sprockets require $13. b. The direct labor wage rate is $14 per hour. c. Hubs require special equipment and are more complex to manufacture than Sprockets. d. The ABC system has the following activity cost pools: Activity Cost Pool (Activity Measure) Machine setups (number of setups) Special processing (machine-hours) Estimated Overhead Cost $ 35,235 $166,500 Hubs 145 Activity Sprockets 116 Total 3,700 $ 166,600 NA NA 261 3,700 NA General factory (organization-sustaining) Required: 1. Compute the activity rate for each activity cost pool. 2. Determine the unit product cost of each product according to the ABC system. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the activity rate for each activity cost pool.
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