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Product Costs using Activity Rates other activities are required to produce the two products. These activities and their associated activity rates are as follows: The
Product Costs using Activity Rates
other activities are required to produce the two products. These activities and their associated activity rates are as follows:
The activitybase usage quantities and units produced for each product were as follows:
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Calculate Activity Cost for each product: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 $ per machine hour
Assembly $ per direct labor hour
Setup $ per setup
Inspecting $ per inspection
Production scheduling $ per production order
Purchasing $ per purchase order
The activitybase usage quantities and units produced for each product were as follows:
Activity Base Elliptical Machines Treadmill
Machine hours
Direct labor hours
Setups
Inspections
Production orders
Purchase orders
Units produced
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 $fill in the blank
$fill in the blank
Treadmill $fill in the blank
$fill in the blank
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Calculate Activity Cost for each product:
ActivityBase Usage for each activity x Activity Rate Activity Cost; Add all activity costs for each product to obtain the total cost per product. Divide total costs by number of units to obtain activity cost per unit.
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