Question
Multiple Versus Single Overhead Rates, Activity Drivers Deoro Company has identified the following overhead activities, costs, and activity drivers for the coming year: Activity
Multiple Versus Single Overhead Rates, Activity Drivers Deoro Company has identified the following overhead activities, costs, and activity drivers for the coming year: Activity Expected Cost Activity Driver Activity Capacity Setting up equipment $488,560 Number of setups 620 Ordering costs 307,800 Number of orders 17,100 Machine costs 736,200 Machine hours 40,900 Receiving 308,000 Receiving hours 8,800 Deoro produces two models of dishwashers with the following expected prime costs and activity demands: Model A Model B Direct materials $586,000 $845,000 Direct labor 453,000 484,000 Units completed 15,300 7,100 Direct labor hours 6,900 2,200 Number of setups 400 220 Number of orders 5,200 11,900 Machine hours 23,800 17,100 Receiving hours 2,800 6,000 The company's normal activity is 9,100 direct labor hours.
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