1. Southeastern Paper Company manufactures three products (computer paper, newsprint, and specialty paper) in a continuous production process. Senior management has asked the controller to conduct an activity-based costing study. The controller identified the amount of factory overhead required by the critical activities of the organization as follows:

The activity bases identified for each activity are as follows:

Activity Activity Base

Production Machine hours

Setup Number of setups

Moving Number of moves

Shipping Number of customer orders

Product engineering Number of test runs

The activity-base usage quantities and units produced for the three products were determined from corporate records and are as follows:

Find the activity rate, total MOH overhead per product and MOH per unit for each product.

Activity Production Setup Moving Shipping Product engineering Total Activity Costs $220,000 117,000 21,000 105,000 102,000 $565,000 Machine Number of Hours Setups 400 80 500 30 200 150 1,100 260 Computer paper Newsprint Specialty paper Total Number of Customer Orders 310 140 Number of Moves 230 70 300 600 Number of Test Runs 50 15 105 170 Units 1,000 1,250 500 2,750 550 1,000