Question
Kelso Manufacturing allocates manufacturing overhead using a single predetermined rate based on a planned use of 15,000 direct labour hours per year. Company leadership recently
Kelso Manufacturing allocates manufacturing overhead using a single predetermined rate based on a planned use of 15,000 direct labour hours per year. Company leadership recently learned that its costing system may be too simple for its operations, and that job costs may be fairly inaccurate. A consultant was hired to study overhead costs, and the following information reflects the cost pools and activity rates that were determined:
Cost Pool | Total Cost | Activity Rate |
Purchasing | $90,000 | $30/purchase order |
Assembly | $150,000 | $?/direct labour hour |
Inspection | $60,000 | $15/inspection |
Production | $150,000 | $3/unit produced |
Total | $450,000 |
Based on the information presented in the introduction and table above, Kelsos single predetermined manufacturing overhead cost rate is ______ and its rate for the Assembly cost pool is ______.
Question 8
a.
$30/direct labour hour; $30/direct labour hour
b.
$30/direct labour hour; $10/direct labour hour
c.
$30/direct labour hour; $15/direct labour hour
d.
$10/direct labour hour; $10/direct labour hour
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