Question 1 (12 points) Campbell's Company uses activity-based costing (ABC) to allocate overhead costs. Their accountant has established indirect cost pools and cost drivers relevant of the production department for the coming year as follows: Budgeted cost $ 56,000 Indirect cost pools Materials handling Machine processing Maintenance Electricity 60,000 Cost driver Total level of cost driver Materials 28,000 kg weight Number set- 300 ups Machine hours 25,000 Direct labour 14,560 hours hours Number of 70,000 units units 10,000 38,220 Quality control 35,000 Campbells produces three types of outdoor umbrellas: large, medium, and small. The sales team have received an order for 250 large umbrellas and the production team has produced them. The order required the following: Materials 650 kg Machine set-ups 4 set-ups Machine hours 275 machine hours Direct labour hours 250 hours Required (rounded to two decimal places). 1 - Calculate the indirect cost rate for each cost pool. [2.5 marks] 2 - Calculate the allocated overhead per large umbrella. [3.5 marks] 3 - Suppose that a single indirect cost rate based on machine hours was used to allocate indirect costs, calculate the indirect cost rate. [2 marks] 4 - Using the single allocation rate of machine hours, calculate the overhead allocated per large ubrella. [1 mark] 5 - Briefly comment on any differences in your answer to (2) above. [3 marks] Question 1 (12 points) Campbell's Company uses activity-based costing (ABC) to allocate overhead costs. Their accountant has established indirect cost pools and cost drivers relevant of the production department for the coming year as follows: Budgeted cost $ 56,000 Indirect cost pools Materials handling Machine processing Maintenance Electricity 60,000 Cost driver Total level of cost driver Materials 28,000 kg weight Number set- 300 ups Machine hours 25,000 Direct labour 14,560 hours hours Number of 70,000 units units 10,000 38,220 Quality control 35,000 Campbells produces three types of outdoor umbrellas: large, medium, and small. The sales team have received an order for 250 large umbrellas and the production team has produced them. The order required the following: Materials 650 kg Machine set-ups 4 set-ups Machine hours 275 machine hours Direct labour hours 250 hours Required (rounded to two decimal places). 1 - Calculate the indirect cost rate for each cost pool. [2.5 marks] 2 - Calculate the allocated overhead per large umbrella. [3.5 marks] 3 - Suppose that a single indirect cost rate based on machine hours was used to allocate indirect costs, calculate the indirect cost rate. [2 marks] 4 - Using the single allocation rate of machine hours, calculate the overhead allocated per large ubrella. [1 mark] 5 - Briefly comment on any differences in your answer to (2) above. [3 marks]