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Super Speaker company makes two different grades of speakers for use with mobile devises, a Premium and a Standard. They have decided to implement an
Super Speaker company makes two different grades of speakers for use with mobile devises, a Premium and a Standard. They have decided to implement an ABC system for analyzing the costs of the two different lines. After a cost study, the accounting team at Super Speaker came up with the following information:
Activity | Cost | Allocation Base |
Setups | $52030 | Number of Setups |
Machine Maintenance | $36551 | Number of machine hours |
Estimated amount of allocation base equaled actual amount during the period.
Standard | Premium | Total | |
Direct Labor Hours | 1855 | 2244 | 4099 |
Number of Setups | 44 | 56 | 100 |
Number of Machine Hours | 1741 | 1130 | 2871 |
Required: Compute the amount of indirect cost applied to the Premium speakers.
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