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Question 2 (12 Marks) Shadow Awnings makes custom awnings for homes and businesses. The companyuses an activity-based costing system for its overhead costs. The companyhas
Question 2 (12 Marks) Shadow Awnings makes custom awnings for homes and businesses. The companyuses an activity-based costing system for its overhead costs. The companyhas provided the following data conceming its amual overhead costs and its activity cost pools Ovehead Costs: $150,000 $100,000 $250,000 Production overhead Office expense Total Distribution of resourece consumption: Activity Cost Pools Making Awnings 45% 8% Job Support Other 40% Total 100% Production overhead Office expense 15% 65 % 27% 100% The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs. The amount of activity for the year is as follows Annual Activity 5,000 metres Activity Cost Pool Making Awnings Job Support Other 200 jobs Not applicable Required a) Prepare the first-stage allocation of overhead costs to the activitycost pools byfilling in the table below (4 Marks): Making Awnings Job Support Other Iotal Production Overhead Office Expense Total b) Compute the activityrates (ie., cost perunit of activity) for the Making Awnings and Job Support activity cost pools by filling in the table below(3 Marks) Making Awnings Job Support Production Overhead Office Expense Total c) Prepare an income report in good form ofajob that involves making 80 meters of awnings and has direct materials and direct labour cost of $3,000. The sales revenue from this job is $4,000
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