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Saddle Inc. has two types of handbags: standard and custom. The controller has decided to use a plantwide overhead rate based on direct labor costs.
Saddle Inc. has two types of handbags: standard and custom. The controller has decided to use a plantwide overhead rate based on direct labor costs. The president has heard of activity-based costing and wants to see how the results would differ if this system were used. Two activity cost pools were developed: machining and machine setup. Presented below is information related to the company's operations. Standard Custom Direct labor costs $50,000 $100,000 Machine hours 1,200 1,200 Setup hours 120 390 Total estimated overhand costs are $299,100. Overhead cost allocated to the machining activity cost pool # $192,000, and $107,100 is allocated to the machine setup activity cost pool Your answer is correct. Compute the overhead rate using the traditional (plantwida) approach. (Hound answer to 2 decimal c. 17.25) Predetermined overhead rate 1994 of direct labor cost SW SON LINK TO TEX LINK TO TEXT VIDEO SIMILAR EXERCENE CALCULATOR PRINTER VERSION 4 tiACK NE Your answer is correct. Compute the overhead rates using the activity-based costing approach Machining 80 per machine hour Machine setup 210 per setup hour SHOW SOLUTION LINK TO TEXT LINK 10 TEXT VIDEO SIMILAR EXERCISE x Your answer is incorrect. Try again. Determine the difference in allocation between the two approaches. Traditional costing Standard Custom Activity-based costing Standard - C 1133 AM x Your answer is incorrect. Try again. Determine the difference in allocation between the two approaches. Traditional costing Standard Y = Custom Activity-based costing Standard Custom Click if you would like to show Work for this question: Open Show Wark
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