Novak Industries manufactures dining chairs and tables. The following information is available regarding the two products and their estimated use of cost drivers: Dining Chairs Tables Estimated Cost Machine setups 255 655 $49,140 Inspections 305 525 $73,040 Labor hours 2,600 2.400 Novak is considering switching from one overhead rate based on labor hours to ABC. Perform the following analyses for these two components of overhead: (a) Compute total machine setups and inspection costs assigned to each product, using a single overhead rate. (Round overhead rate value to 3 decimal places, es, 52.711 and final answers to decimal places, es 5275) Total Costs Dining chairs Tables Rojas Vineyards in Oakville, California, produces three varieties of wine: merlot, viognier, and pinot noir. The winemaster, Russel Hansen, has identified the following activities as cost pools for accumulating overhead and assigning it to products. For each of Rojas Vineyards' activity cost pools, identify a probable cost driver that might be used to assign overhead costs to its three wine varieties Cost Drivers 1. Number of boxes 2 Number of carts or labor hours 3. Number of carts or labor hours Acitivity Cost Pools Spraying. The vines are sprayed with organic pesticides for protection against insects and fungi. Harvesting. The grapes are hand-picked, placed in carts, and transported to the crushers. Stemming and crushing. Cartfuls of bunches of grapes of each variety are separately loaded into machines that remove stems and gently crush the grapes. Pressing and filtering. The crushed grapes are transferred to presses that mechanically remove the juices and filter out bulk and impurities. Fermentation. The grape juice, by variety, is fermented in either stainless-steel tanks or oak barrels Aging. The wines are aged in either stainless-steel tanks or oak barrels for one to three years depending on variety Bottling and corking Bottles are machine-Filled and corked. 4. Number of boxes 5 6. 7. Number of bottles 8. Labeling and boxing. Each bottle is labeled, as is each nine-bottle case, with the name of the vintner, vintage, and variety 9. Storing Packaged and boxed bottles are stored awaiting shipment: 6. Aging. The wines are aged in either stainless-steel tanks or oak barrels for one to three years depending on variety Bottling and corking. Bottles are machine-filled and corked. 7 Number of bottles 8. Labeling and boxing. Each bottle is labeled, as is each nine-bottle case, with the name of the vintner, vintage, and variety Storing Packaged and boxed bottles are stored awaiting shipment. 9. 10. Shipping. The wine is shipped to distributors and private retailers. 11 Heating and air-conditioning of plant and offices. Number of bottles 12. Maintenance of production equipment. Repairs, replacements, and general maintenance are performed in the off-season. Number of bottles
