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help me with question 3 Direct labor or machine hours may not be the appropriate cost driver for overhead in all areas of manufacturing due
help me with question 3
Direct labor or machine hours may not be the appropriate cost driver for overhead in all areas of manufacturing due to the complexities of marry manufacturing processes. Many companies use activity-based costing (ABC) which uses multiple drivers (items that consume resources) rather than just one driver to apply overhead to their activities. With ABC, a company can use a cost driver that has a direct causeleffect relafionship in its applied overthead costs. Waterways looked into ABC as a method of costing because of the variety of items it produces and the many different activities in which it is involved. The activities listed below area sample of possible cost pools for Waterways. Using the following information, determine the overhead rates and the actual cost assigned for each of the activity cost pools in a possible ABC system for Waterways. (Round answers to 2 decimal places, eg. 12.25) WATERWAYS CORPORATION \begin{tabular}{c} Activity- \\ Bctivity Cost \\ Pools \\ Overhead \\ Rates \end{tabular} Irrigation installation Machining (all machine use) Step by Step Solution
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