Question
Lightsquare Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and their associated budgeted activity costs
Lightsquare Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and their associated budgeted activity costs and activity bases are as follows: Budgeted Activity Activity Cost Activity Base Casting $130,254 Machine hours Assembly 54,986 Direct labor hours Inspecting 18,870 Number of inspections Setup 35,400 Number of setups Materials handling 24,710 Number of loads Corporate records were obtained to estimate the amount of activity to be used by the two products. The estimated activity-base usage quantities and units produced follow: Activity Base Entry Dining Total Machine hours 2,844 987 3,831 Direct labor hours 804 2,090 2,894 Number of inspections 807 303 1,110 Number of setups 177 59 236 Number of loads 481 225 706 Units produced 6,192 2,127 8,319 Required: Complete the Activity Table for entry lighting and dining room lighting fixtures. A. Determine the activity rate for each activity. Enter these rates in the Activity Rate columns. B. Use the activity rates in (A) to determine the total and per-unit activity costs associated with each product. Round the per-unit rates to the nearest cent.
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