Read pictures 1 and 2 left to right. The same for 3 and 4.
SOURCES by Study Problem 17-03A a-b, c1-c3 (Part Level Submission) Shaker Stairs Co. designs and builds factory-made premium wooden stairways for homes. The manufactured stairway components (spindles, risers, hangers costs for the year 2020 are as follows. Overhead Cost Pools Amount Purchasing $75,000 Handling materials 82,000 Production (cutting, milling, finishing) 220,000 Setting up machines 100,000 Inspecting 120,000 Inventory control (raw materials and finished goods) 126,000 Utilities 270,000 Total budgeted overhead costs $993,000 For the last 4 years, Shaker Stairs Co. has been charging overhead to products on the basis of machine hours. For the year 2020, 100,000 machine hours are b Jeremy Nolan, owner manager of Shaker Stairs Co., recently directed his accountant, Bill Seagren, to implement the activity based costing system that he has the previously budgeted overhead cost pools. Estimated Use of Cost Drivers Activity Cost Pools Purchasing Handling materials Production (cutting, milling, finishing) Setting up machines Inspecting Inventory control (raw materials and finished goods) Utilities Cost Drivers Number of orders Number of moves Direct labor hours Number of setups Number of inspections Number of components Square feet occupied 8,000 100.000 1.250 6.000 168,000 90.000 onents (spindles, risers, hangers, hand rails) permit installation of stairways of varying lengths and widths. All are of white oak wood. Budgeted manufacturing overhead ar 2020, 100,000 machine hours are budgeted. vity-based costing system that he has repeatedly proposed. At Jeremy Nolan's request, Bill and the production foreman identify the following cost drivers and the usage for Steve Hannon, sales manager has received an order for 250 stairways from Community Builders, Inc., a large housing development contractor. At Steve's request. Bill precar Community Builders. He accumulates the following data for the production of 250 stairways. $104,200 $112,700 15,000 5,700 Direct materials Direct labor Machine hours Direct labor hours Number of purchase orders Number of material moves Number of machine setups Number of inspections Number of components Number of square feet occupied 300 100 16,000 3.000 Compute the predetermined overhead rate using traditional costing with machine hours as the basis. (Nound answer to decimal places, 12.25) Predetermined overhead rate per machine hour CALCULATOR FULL SCREEN PRINTER VERSION *BAC development contractor. At Steve's request, Bill prepares cost estimates for producing components for 250 stairways so Steve can submit a contract price per stairway to
