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Required information [The following information applies to the questions displayed below.] Hickory Company manufactures two products-15,000 units of Product Y and 7,000 units of
Required information [The following information applies to the questions displayed below.] Hickory Company manufactures two products-15,000 units of Product Y and 7,000 units of Product Z. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates all $597,000 of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products Y and Z Activity Cost Pool Machining Machine setups Product design General factory Number of Expected Activity $213,400 11,000 MHS Estimated Overhead Activity Measure Cost Machine-hours $ 61,600 140 setups setups Number of products $ 78,000 2 products Direct labor- hours $244,000 13,200 DLHS Product Product Activity Measure Machine-hours Number of setups Y Z 6,400 4,600 60 80 Number of products 1 1 Direct labor- hours 7,400 5,800
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