Fogerty Company makes two productstitanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours per Unit Annual Production Hubs 0.70 29,000 units Sprockets

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Fogerty Company makes two productstitanium Hubs and Sprockets. Data regarding the two products follow:

	Direct Labor-Hours per Unit	Annual Production
Hubs	0.70	29,000 units
Sprockets	0.30	60,000 units

Additional information about the company follows:

a. Hubs require $38 in direct materials per unit, and Sprockets require $12.

b. The direct labor wage rate is $11 per hour.

c. Hubs are more complex to manufacture than Sprockets and they require special processing.

d. The companys activity-based absorption costing system has the following activity cost pools:

	Estimated		Expected Activity
Activity Cost Pool (and Activity Measure)	Overhead Cost		Hubs	Sprockets	Total
Machine setups (number of setups)	$	25,515	105	84	189
Special processing (machine-hours)	$	90,000	4,500	0	4,500
General factory (Direct labor-hours)	$	727,700	20,300	18,000	38,300

Required:

1. Compute the activity rate for each activity cost pool.

2. Compute the unit product cost for Hubs and Sprockets using activity-based absorption costing.

Compute the activity rate for each activity cost pool.

Activity Cost Pool	Activity Rate
Machine setups.		per setup
Special processing		per MH
General factory		per DLH

	Hubs	Sprockets
Direct materials
Direct labor
Manufacturing overhead
Unit product cost