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Neal Company manufactures computer workstations. The companys three activities and their overhead cost drivers follow. Activity Budgeted Cost Activity Cost Driver Budgeted Activity Usage Fabrication

Neal Company manufactures computer workstations. The companys three activities and their overhead cost drivers follow.

Activity Budgeted Cost Activity Cost Driver Budgeted Activity Usage
Fabrication $ 80,000 Machine hours 1,600 machine hours
Assembly 96,000 Direct labor hours 2,000 direct labor hours
Inspection 72,000 Units inspected 6,000 units

Job 101s actual activity usage along with a partial customer profitability report follow.

Machine Hours Direct Labor Hours Units
Job 101 25 MH 30 DLH 10

Profitability ReportJob 101
Sales $ 8,500
Cost of goods sold
Direct materials $ 1,940
Direct labor 750
Overhead ? ?
Gross profit ?
Customer service costs 500
Customer income ?

Required: 1. Compute activity rates using activity-based costing. 2. Use the results from part 1 to allocate overhead cost to Job 101. 3. Complete the profitability report for Job 101.

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