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The accountant for Halifax Photographic Supply Ltd has estimated the following activity cost pools and activity drivers for the coming year: Activity Budgeted overhead cost

The accountant for Halifax Photographic Supply Ltd has estimated the following activity cost pools and activity drivers for the coming year:

Activity

Budgeted overhead cost

Activity driver

Budgeted level for activity driver

Machine setups

$200,000

No. of setups

100 setups

Material handling

$100,000

Weight of raw material

50,000 kilograms

Hazardous waste control

$50,000

Weight of hazardous chemicals used

10,000 kilograms

Quality control

$75,000

No. of inspections

1,000 inspections

Other overhead costs

$200,000

Machine hours

20,000 machine hours

TOTAL

$625,000

Halifax Photographic Supply Ltd has received an order for 1000 boxes of film development chemicals. In addition to direct material costing $120 per box and direct labour costing $40 per box, the order has the following production requirements:

Machine setups 4 setups

Raw material 10,000 kilograms

Hazardous materials 2,000 kilograms

Inspections 10 inspections

Machine hours 500 machine hours

Required:

(Enter amounts only and do not use dollar signs or commas and if required use two decimal places)

(a) If Halifax Photographic Supply Ltd were to use a plantwide predetermined overhead rate based on machine-hours, compute the overhead rate per machine hour. Answer

(1 mark)

(b) If Halifax Photographic Supply Ltd were to use a plantwide predetermined overhead rate based on machine-hours, compute the total manufacturing cost of the order. Answer

(2 marks)

(c) Compute the total manufacturing overhead costs allocated to the order. Answer

(3 marks)

(d) Compute the total manufacturing cost of the order using activity-based costing. Answer

(1 mark)

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