Question
Sultan Company uses an activity-based costing system. At the beginning of the year, the company made the following estimates of cost and activity for its
Sultan Company uses an activity-based costing system. At the beginning of the year, the company made the following estimates of cost and activity for its five activity cost pools: Activity Cost Pool Activity Measure Expected Overhead Cost Expected Activity Labor-related Direct labor-hours $ 135,600 22,600 DLHs Purchase orders Number of orders $ 8,400 240 orders Parts management Number of part types $ 68,870 97 part types Board etching Number of boards $ 53,700 1,790 boards General factory Machine-hours $ 171,000 19,000 MHs Required: 1. Compute the activity rate for each of the activity cost pools. 2. The expected activity for the year was distributed among the companys four products as follows:
Sultan Company uses an activity-based costing system. At the beginning of the year, the company made the following estimates of cost and activity for its five activity cost pools: Expected Activity Cost Pool Activity Measure Overhead Cont Expected Activity Labor-related Direct labor-hours $ 135, 600 22, 600 DLHS Purchase orders Number of orders $ 3,400 240 orders Barts management Number of part types $ 68,870 97 part types Board etching Number of boards $ 53,700 1,790 boards General factory Machine-hours $ 171,000 19,000 MH Required: 1. Compute the activity rate for each of the activity cost pools. 2. The expected activity for the year was distributed among the company's four products as follows: Activity Cost Pool Labor-related (DLH) Purchase orders (orders) Barts management (part types) Board etching (boards) General factory (MH) Expected Activity Product 2 Product B Product Product D 3,000 11,900 3,700 4,000 73 33 100 28 15 49 10 480 770 540 12, 600 ,000 13,500 900 Using the ABC data, determine the total amount of overhead cost assigned to each product. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the activity rate for each of the activity cost pools. Activity Cost Pool Labor-related Purchase orders Parts management Board etching General factory Activity Rate per DLH per order per part type per board per MH Complete this question by entering your answers in the tabs below. Required 1 Required 2 Using the ABC data, determine the total amount of overhead cost assigned to each product. Overhead Cost Assigned Activity Cost Pool Product A Product B Product C Producto Labor-related (DLHs) Purchase orders (orders) Parts management (part types) Board etching (boards) General factory (MHS) TotalStep by Step Solution
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