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QUESTION 1 Age of Aquarius (AA) is a well-established manufacturing company that produces new age furniture. AA has used direct inbor hours as the basis

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QUESTION 1 Age of Aquarius (AA) is a well-established manufacturing company that produces new age furniture. AA has used direct inbor hours as the basis for allocating company-wide overhead for many years. However, given recent investments in manufacturing technologies, management feels that ABC costing would perhaps provide a more accurate assessment of the true price of the goods produced. The following costs have been accumulated and corresponding drivers measured: Cost Pool Activity Driver Budgeted Alver Usage: Chairs 50,000 hrs 100,000 hrs Budgeted Cost $40,000 $50,000 Actual Driver Usage: Chairs 45,000 hrs 84.000 hrs Actual Cost $40,000 $63,000 Depreciation Utilities Budgeted Driver Usage: Tables 10,000 hrs 20,000 hrs Machine hrs. Direct labor hrs. Actual Driver Usage: Tables 15,000 hrs 24,000 hrs Lathing Factory production Materials Handling # of Shipments Inventory Storage/Wages $120,000 $110,000 250 shipments 230 shipments 50 shipments 60 shipments Additionally, the following information is available relative to production levels: Type Chairs Expected Production 10,000 units 500 units Actual Production 7,500 units 600 units Tables a. What are the activity rates for this period? b. Using these rates, what is the total overhead allocated to a chair produced this period? What is the per-unit overhead allocated? c. Using these rates, what is the total overhead allocated to a table produced this period? What is the per-unit overhead allocated? TTT Arial : 3 (12pt) T-5 E -5 Click Save and Submit to save and submit. Click Save All Answers to save all answers. Save A

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