Part 1.

Part 2.

Lonsdale Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and their associated budgeted activity costs and activity bases are as follows:

Activity	Budgeted Activity Cost		Activity Base
Casting	$269,700		Machine hours
Assembly	212,000		Direct labor hours
Inspecting	31,790		Number of inspections
Setup	37,700		Number of setups
Materials handling	32,760		Number of loads

Corporate records were obtained to estimate the amount of activity to be used by the two products. The estimated activity-base usage quantities and units produced follow:

Activity Base	Entry		Dining		Total
Machine hours	4,930		4,370		9,300
Direct labor hours	4,240		6,360		10,600
Number of inspections	1,420		450		1,870
Number of setups	230		60		290
Number of loads	660		180		840
Units produced	9,800		4,900		14,700

a. Determine the activity rate for each activity. If required, round the rate to the nearest dollar.

Activity	Activity Rate
Casting	$________	per machine hour
Assembly	$________	per direct labor hour
Inspecting	$________	per inspection
Setup	$________	per setup
Materials handling	$________	per load

b. Use the activity rates in (a) to determine the total and per-unit activity costs associated with each product. Round the per unit amounts to the nearest cent.

Product	Total Activity Cost	Activity Cost Per Unit
Entry Lighting Fixtures	$_________	$_______
Dining Room Lighting Fixtures	$_________	$_______

Activity-Based Costing for a Service Company Crosswinds Hospital plans to use activity-based costing to assign hospital indirect costs to the care of patients. The hospital has identified the following activities and activity rates for the hospital indirect costs: Activity Activity Rate Room and meals $173 per day $244 per image Radiology Pharmacy $58 per physician order Chemistry lab $74 per test Operating room $680 per operating room hour The activity usage information associated with the two patients is as follows: Abel Putin Cheryl Umit Number of days 4 days 9 days Number of images 2 images 6 images Number of physician orders 5 orders 7 orders Number of tests 5 tests 8 tests Number of operating room hours 4 hours 6 hours a. Determine the activity cost associated with each patient. Abel Putin Cheryl Umit b. Why is the total activity cost different for the two patients? is more than the apparently had a different condition that required more extensive treatment. Thus, the activity cost to activity cost of the other patient