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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: Expected Activity Cost Pool Activity Measure Direct labor-hours Expected Activity 38,600 DLHs Overhead Cost $ 231,600 Labor-related 15,015 95, 200 $ 106,800 $ 184,500 Purchase orders Number of orders 231 orders 112 part types Parts management Board etching General factory Number of part types Number of boards 1,780 boards Machine-hours 20,500 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 company's four products as follows: Expected Activity Activity Cost Pool Labor-related (DLHS) Purchase orders (orders) Parts management (part types) Board etching (boards) General factory (MHs) Product D 4,000 Product A Product B Product C 4,500 26,600 3,500 70 37 32 92 32 19 48 13 360 790 630 7,700 4,000 2,800 6,000 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 Rate Activity Cost Pool Labor-related per DLH Purchase orders per order Parts management per part type Board etching per board General factory per MH Required 2 Required 1
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