Question
Marthas Cookware Company has three cost pools and overhead estimates are as follows: Activity Cost Pool Cost Driver Estimated OH Cost Use per Product A
Marthas Cookware Company has three cost pools and overhead estimates are as follows:
| Activity Cost Pool | Cost Driver | Estimated OH Cost | Use per Product A | Use per Product B |
| Machine setups | Setups | 360,000 | 8,000 | 4,000 |
| Assembly | Number of parts | 420,000 | 20,000 | 36,000 |
| Machine maintenance | Machine hours | 500,000 | 9,000 | 41,000 |
A. Compute the OH allocation using the traditional allocation method for product A: (Hint: For the traditional method, use machine hours as the allocation base.)
B. Compute the OH allocation using the traditional allocation method for product B: (Hint: For the traditional method, use machine hours as the allocation base.)
C. Compute the OH allocation using the activity-based costing method for product A:
D. Compute the OH allocation using the activity-based costing method for product B:
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Fundamentals of Advanced Accounting
Authors: Joe Ben Hoyle, Thomas Schaefer, Timothy Doupnik
5th edition
978-0077924379, 77924371, 978-0078025396, 78025397, 978-0077425654, 77425650, 978-0077667061
