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Hickory Company manufactures two products-14,000 units of Product Y and 6,000 units of Product Z. The company uses a plantwide overhead rate based on
Hickory Company manufactures two products-14,000 units of Product Y and 6,000 units of Product Z. The company uses a plantwide overhead rate based on direct labour-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: Machining Machine setups Production design General factory Activity Measure Machine-hours Number of setups Number of products Direct labour-hours Estimated Overhead Cost $200,000 $100,000 $ 84,000 $300,000 Expected Activity 10,000 MH 200 setups 2 products 12,000 DLHS Activity Measure Machine-hours Number of setups Number of products Direct labour-hours Product Y 7,000 50 1 8,000 Product Z 3,000 150 1 4,000 Required: Using the plantwide overhead rate, how much manufacturing overhead cost is allocated to Product Y and Product Z? Manufacturing overhead allocated Product Y Product Z < Prev 2 3 4 6 of 11 Next >
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