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Greenwood Company manufactures two products-15,000 units of Product Y and 7,000 units of Product Z. The company uses a plantwide overhead rate based on
Greenwood Company manufactures two products-15,000 units of Product Y and 7,000 units of Product Z. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates all of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products Y and Z: Activity Cost Pool Machining Machine setups Production design General factory Activity Measure Machining Number of setups Number of products Direct labor-hours Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Estimated Overhead Cost $ 210,100 Product Y Product Z 7,100 60 3,900 1 7,100 50 1 2,900 $ 45,100 $ 75,000 $ 241,000 Expected Activity 11,000 MHS 110 setups 2 products 10,000 DLHS Foundational 4-4 (Algo) 4. What is the activity rate for the Machine Setups activity cost pool? Activity rate per setup
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