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Manufacturing overhead $500,000 Selling and administrative overhead $300,000 Assembling Units Processing Orders Supporting Customers Other Manufacturing overhead 50% 35% 5% 10% Selling and administrative overhead

Manufacturing overhead $500,000 Selling and administrative overhead $300,000 Assembling Units Processing Orders Supporting Customers Other Manufacturing overhead 50% 35% 5% 10% Selling and administrative overhead 10% 45% 25% 20% Total activity 1,000 250 100 units orders customers OfficeMart orders: Customers 1 customer Orders 4 orders Number of filing cabinets ordered in total 80 units Selling price $595 Direct materials $180 Direct labor $50 Assembling Units Processing Orders Supporting Customers Other Total Manufacturing overhead ? ? ? ? ? Selling and administrative overhead ? ? ? ? ? Total cost ? ? ? ? ? Compute the activity rates Activity Cost Pools Total Cost Total Activity Activity Rate Assembling units ? ? units ? per unit Processing orders ? ? orders ? per order Supporting customers ? ? customers ? per customer Activity Cost Pools Activity Rate Activity ABC Cost Assembling units ? per unit ? units ? Processing orders ? per order ? orders ? Supporting customers ? per customer ? customer ? Sales ? Costs: Direct materials ? Direct labor ? Unit-related overhead ? Order-related overhead ? Customer-related overhead ? ? Customer margin ? Manufacturing overhead ? Total activity ? units Manufacturing overhead per unit ? per unit Sales ? Costs: Direct materials ? Direct labor ? Manufacturing overhead ? ? Traditional costing product margin ?

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