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Orange uses activity - based costing. Two of Orange's production activities are kitting ( assembling the raw materials needed for each computer in one kit
Orange uses activitybased costing. Two of Orange's production activities are kitting assembling the raw materials needed for each computer in one kit and boxing the completed products for shipment to customers. Assume that Orange spends $ per month on kitting and $ per month on boxing. Orange allocates the following:
Kitting costs based on the number of parts u'sed in the computer
Boxing costs based on the cubic feet of space the computer requires
Suppose Orange estimates it will use parts per month and ship products with a total volume of cubic feet per month. Assume that each desktop computer requires parts and has a volume of cubic feet.
What are the predetermined overhead allocation rates? Round all calculations to the nearest cent.
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