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Southwest Components recently switched to activity-based costing from the department allocation method. The Fabrication Department manager has estlmated the following cost drivers and rates: Direct
Southwest Components recently switched to activity-based costing from the department allocation method. The Fabrication Department manager has estlmated the following cost drivers and rates: Direct materlals costs were $317,000 and direct labor costs were $160,000 during July, when the Fabrication Department handled 3,700 pounds of materlals, made 790 inspections, had 50 setups, and ran the machines for 14,000 hours. Required: Use T-accounts to show the flow of materlals, labor, and overhead costs from the four overhead actlvity centers through Work-InProcess Inventory and out to Finished Goods Inventory
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