Question
Spud, Inc a manufacturer of gourmet potato chips, employs activity-based costing. The budgeted data for each of the activity cost pools is provided below for
Spud, Inc a manufacturer of gourmet potato chips, employs activity-based costing. The budgeted data for each of the activity cost pools is provided below for the year 2017.
Activity cost pools Estimated Expected Use of cost Drivers per Activity
----------------------------- Overhead
Ordering and receiving $84,000 12,000 orders
Food processing 480,000 60,000 machine hours
Packaging 1,760,000 440,000 labor hours
For 2017, the company had 11,000 orders and used 50,000 machine hours, and labor hours totaled 500,000. What is the total overhead applied?
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