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Hazelnut Corp. manufactures lawn onaments. It currently has two product lines, the basic and the luxury. Hazelnut has a total of $171.703 in overhead. The
Hazelnut Corp. manufactures lawn onaments. It currently has two product lines, the basic and the luxury. Hazelnut has a total of $171.703 in overhead. The company has identified the following information about its overhead activity cost pools and the two product lines: QuantitylAmount Quantity/Amount Consumed Activity Cost Pools Materials handling Quality control Machine maintenance Cost Driver Number of moves Number of inspections Number of machine hours Cost Assigned to Pool $3,213 $ 27,090 $141,400 Consumed by Basic 20 moves 160 inspections 5,400 machine hours by Luxury 43 moves 155 inspections 4,700 machine hours Required 1. Suppose Hazelnut used a traditional costing system with machine hours as the cost driver. Determine the amount of overhead assigned to each product line. (Do not round intermediate calculations and round your final answers to the nearest whole dollar amount.) Basic Model Overhead Assigned Luxury Model 2. Calculate the activity rates for each cost pool in Hazelnut's ABC system. Activity Rates Materials Handling Quality Control Machine Maintenance per Move per Inspection per Machine Hour 3. Calculate the amount of overhead that Hazelnut will assign to the basic line if it uses an ABC system. Basic Model Materials Handling Quality Control Machine Maintenance Total Overhead Assigned 4. Determine the amount of overhead Hazelnut will assign to the luxury line if it uses an ABC system
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