Question
Required information Skip to question [The following information applies to the questions displayed below.] Rustafson Corporation is a diversified manufacturer of consumer goods. The company's
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[The following information applies to the questions displayed below.]
Rustafson Corporation is a diversified manufacturer of consumer goods. The company's activity-based costing system has the following seven activity cost pools:
| Activity Cost Pool | Estimated Overhead Cost | Expected Activity | |||
| Labor-related | $ | 17,600 | 5,000 | direct labor-hours | |
| Machine-related | $ | 14,000 | 8,000 | machine-hours | |
| Machine setups | $ | 31,500 | 700 | setups | |
| Production orders | $ | 32,900 | 700 | orders | |
| Product testing | $ | 24,000 | 600 | tests | |
| Packaging | $ | 90,000 | 3,600 | packages | |
| General factory | $ | 50,000 | 5,000 | direct labor-hours | |
Required:
1. Compute the activity rate for each activity cost pool.
2. Compute the company's predetermined overhead rate, assuming that the company uses a single plantwide predetermined overhead rate based on direct labor-hours.
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Management and Cost Accounting
Authors: Colin Drury
8th edition
978-1408041802, 1408041804, 978-1408048566, 1408048566, 978-1408093887
