question 9

Craft Pro Machining produces machine tools for the construction industry. The following details about overhead costs were taken from its company records.

Production Activity	Indirect Labor				Indirect Materials				Other Overhead
Grinding	$	340,000
Polishing					$	145,000
Product modification		550,000
Providing power									$	215,000
System calibration		440,000

Additional information on the drivers for its production activities follows.

Grinding	18,000	machine hours
Polishing	18,000	machine hours
Product modification	2,000	engineering hours
Providing power	17,000	direct labor hours
System calibration	1,000	batches

	Job 3175		Job 4286
Number of units	210	units	2,625	units
Machine hours	450	MH	4,500	MH
Engineering hours	32	eng. hours	28	eng. hours
Batches	10	batches	30	batches
Direct labor hours	450	DLH	4,050	DLH

Required: 1. Classify each activity as unit level, batch level, product level, or facility level.

Required: 5. If the company uses a plantwide overhead rate based on direct labor hours, what is the overhead cost for each unit of Job 3175? Of Job 4286? (Do not round intermediate calculations. Round "OH Cost per unit" answers to 2 decimal places.) Product DL hours Plantwide OH rate Total Overhead Cost Units Produced OH Cost per unit Job 3175 Job 4286 Required: 2, 3 & 4. Compute the activity overhead rates using ABC. Combine the grinding and polishing activities into a single cost pool. Determine overhead costs to assign to the above jobs using ABC. What is the overhead cost per unit for Job 3175? What is the overhead cost per unit for Job 4286? (Round your activity rate and average overhead cost per unit to 2 decimal places. Round "overhead assigned" to the nearest whole dollar.) Job 3175 Job 4286 Activity driver Overhead incurred assigned Activity Overhead Cost Activity Drivers Activity Rate Overhead assigned Activity driver incurred Grinding & Polishing Machine hours Product modification Engineering hrs. Providing power Direct labor hrs. System calibration batches Required: 1. Classify each activity as unit level, batch level, product level, or facility level. Grinding Polishing Product modification Providing power System calibration