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Fogerty Company makes two products-titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours Hubs Sprockets per Unit 0.60 0.20 Annual Production 19,000
Fogerty Company makes two products-titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours Hubs Sprockets per Unit 0.60 0.20 Annual Production 19,000 units 59,000 units Additional information about the company follows: a. Hubs require $40 in direct materials per unit, and Sprockets require $13. b. The direct labor wage rate is $17 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) General factory (organization-sustaining) Estimated Overhead Cost $ 18,630 Activity Hubs Sprockets Total 90 72 162 4,000 0 $ 153,000 NA NA 4,000 NA $ 180,000 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. Required 1 Required 2 Compute the activity rate for each activity cost pool. Activity Cost Pool Machine setups Special processing Activity Rate per setup per MH Required 1 Required 2 Determine the unit product cost of each product according to the ABC system. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Direct materials Direct labor Overhead Unit cost Hubs Sprockets
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