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level activity. s costs to PROBLEM 5-32 Computing Unit Product Costs in ABC and Cost Flows (L02-CC6, 7, L04-00101 Coration uses ABC so determine
level activity. s costs to PROBLEM 5-32 Computing Unit Product Costs in ABC and Cost Flows (L02-CC6, 7, L04-00101 Coration uses ABC so determine product cous for external financial reports. At the beginning of the year management made the following cost and activity estimates in the company's five activity Athity Cent Pol Labour related Production onders Materials receipts Relay asembly General factory Activity Measure Direct labour-hours Number of orders Number of receipts Number of relays Machine-hours Estimated Overhead Cont $337,500 Expected Activity 45.000 DL36 101.250 1.125 orders 216,000 1.300 receip 410,400 12.000 lays 1440,000 90,000 MH $2.505.150 any has ew seg clined, model year. pro- del nd Required: 1. Compute the activity rate (ie., predetermined overhead rate) for each of the activity cost pools. 2. During the year, actual overhead cost and activity were recorded as follows: Activity Cost Paol Labour related Production orders Materials receipts Relay assembly General factory Total overhead cost Actual Overhead Cont $318,500 107,000 225,000 410.400 1470,500 $2,531,400 Actual Activity 48,000 DLH 1,050 orders 1,950 receipts 11.830 relays 91,500 MHs CHECK FIGURE Prepare a journal entry to record the incurrence of actual manufacturing overhead cost for the year (credit accounts payable). Post the entry to the company's manufacturing overhead T-account. b. Determine the amount of overhead cost applied to production during the year.
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