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The controller for Tulsa Medical Supply Company has established the following activity cost pools and cost drivers. Activity Cost Pool Machine setups Material handling Hazardous
The controller for Tulsa Medical Supply Company has established the following activity cost pools and cost drivers. Activity Cost Pool Machine setups Material handling Hazardous waste control Quality control Other overhead costs Total Budgeted Overhead Cost 375,000 50,000 50,000 150,000 500,000 $1,125,000 Cost Driver Number of setups Weight of raw material Weight of hazardous chemicals used Number of inspections Machine hours Budgeted Level for Cost Driver 150 25,000 lb. 5,000 lb. 2,000 25,000 Pool Rate $2,500 per setup $ 2 per pound $ 10 per pound $ 75 per inspection $ 20 per machine hour An order for 5,000 boxes of medical-testing agent has the following production requirements. Machine setups Raw material Hazardous materials Inspections Machine hours 5 setups 10,000 pounds 4,000 pounds 10 inspections 900 machine hours Required: 1. Compute the total overhead that should be assigned to the medical-testing agent order. 2. What is the overhead cost per box of testing agent? 3. Suppose Tulsa Medical Supply Company were to use a single predetermined overhead rate based on machine hours. Compute the rate per hour. 4. Under the approach in requirement 3, how much overhead would be assigned to the medical testing agent order? a. In total. b. Per box of testing agent. Req 1 and 2 Req3 Reg 4 Compute the total overhead that should be assigned to the medical testing agent order. What is the overhead cost per box of testing agent? (Round "Overhead cost" to 2 decimal places.) Total overhead Overhead cost per box Reg 1 and 2 Req3 Req 1 and 2 Req3 Req 4 Suppose Tulsa Medical Supply Company were to use a single predetermined overhead rate based on machine hours. Compute the rate per hour. (Round your answer to 2 decimal places.) Overhead rate per machine hr. Req 1 and 2 Reg 4 Req 1 and 2 Req 3 Req 4 Under the approach in requirement 3, how much overhead would be assigned to the medical-testing agent order? a. In total, b. Per box of testing agent. (Round your answer to 2 decimal places.) a. Total overhead b. Overhead cost per box Req3 Req 4
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