Question
Keeley Company makes products C and D. Information for overhead costs and for the two products appears below. The company makes 50,000 units of product
Keeley Company makes products C and D. Information for overhead costs and for the two products appears below. The company makes 50,000 units of product C each year and 20,000 units of Product D.
| Activity | Driver | Total Overhead Cost | Prod C Usage | Prod D usage |
| Setups | # of setups | $200,000 | 500 setups | 1,500 setups |
| Ordering parts | # of parts | $300,000 | 60,000 parts | 40,000 parts |
| Machining | MH | $600,000 | 12,000 MH | 6,000 MH |
| Inspections | # of Insp | $400,000 | 10,000 Insp | 40,000 Insp |
| Shipping | # of shipments | $300,000 | 10,000 Ship | 10,000 Ship |
| Total overhead |
| $1,800,000 |
|
|
|
| * MH Machine Hours | Insp Inspections | Ship - Shipments |
|
How much overhead would be assigned to each unit of Product C?
| A. | $860,000 per unit | |
| B. | $100 per unit | |
| C. | $47 per unit | |
| D. | $17.20 per unit |
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Facilities Managers Reference Management Planning Building Audits Estimating
Authors: Harvey H. Kaiser
1st Edition
0876291426, 978-0876291429
