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Product Costs using Activity Rates Hercules Inc. manufactures elliptical exercise machines and treadmills. The products are produced in its Fabrication and Assembly production departments. In
Product Costs using Activity Rates Hercules Inc. manufactures elliptical exercise machines and treadmills. The products are produced in its Fabrication and Assembly production departments. In addition to production activities, several other activities are required to produce the two products. These activities and their associated activity rates are as follows: Activity Activity Rate Fabrication $30 per machine hour Assembly $14 per direct labor hour Setup $50 per setup $24 per inspection Inspecting Production scheduling Purchasing $15 per production order $12 per purchase order The activity-base usage quantities and units produced for each product were as follows: Activity Base Elliptical Machines Treadmill Machine hours 1,987 1,172 Direct labor hours 384 150 Setups 52 16 Inspections 614 368 Production orders 66 13 Purchase orders 199 121 Units produced 240 161 Use the activity rate and usage information to determine the total activity cost and activity cost per unit for each product. If required, round the per unit answers to the nearest cent. Total Activity Cost Activity Cost Per Unit Elliptical Machines $ $ Treadmill $
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