Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Fogerty Company makes two products-titanium Hubs and Sprockets. Data regarding the two products follow: Hubs Sprockets Direct Labor-Hours per Unit Annual Production 0.80 0.40 10,000
Fogerty Company makes two products-titanium Hubs and Sprockets. Data regarding the two products follow: Hubs Sprockets Direct Labor-Hours per Unit Annual Production 0.80 0.40 10,000 units 50,000 units Additional information about the company follows: a. Hubs require $33 in direct materials per unit, and Sprockets require $15. b. The direct labor wage rate is $18 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) Required: 1. Compute the activity rate for each activity cost pool. Estimated Overhead Cost Hubs Activity Sprockets $ 22,680 $225,000 $208,000 140 112 5,000 0 NA NA 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. Activity Cost Pool Machine setups Special processing Activity Rate per setup per MH Requirid Required 2> Total 252 5,000 NA
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started