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 2020.
Activity Cost Pools | Estimated Overhead | Estimated Use of Cost Drivers per Activity | |||
Ordering and receiving | $73,800 | 12,000 | orders | ||
Food processing | 420,750 | 55,000 | machine hours | ||
Packaging | 1,365,000 | 420,000 | labor hours |
For 2020, the company had 10,000 orders and used 48,000 machine hours, and labor hours totaled 490,000.
Part 1
Calculate the overhead rates for each activity. (Round answers to 2 decimal places, e.g. 12.25.)
Overhead Rates | |||
Ordering and receiving | $ | per order | |
Food processing | $ | per machine hour | |
Packaging | $ | per labor hour |
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Part 2
What is the total overhead applied?
Total overhead applied | $ |
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