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The following is taken from Ronda Co.'s internal records of its factory with two production departments. The cost driver for indirect labor and supplies is
The following is taken from Ronda Co.'s internal records of its factory with two production departments. The cost driver for indirect labor and supplies is direct labor costs, and the cost driver for the remaining overhead items is number of hours of machine use. Machine Use Hours Direct Labor $18,800 13,200 $32,000 2, Bee 1,200 3,200 Department 1 Department 2 Totals Factory overhead costs Rent and utilities Indirect labor General office expense Depreciation-Equipment Supplies Total factory overhead $ 12,200 5,400 4,800 3, eee 2,60e $ 27,200 Compute the total amount of overhead cost allocated to Department 1 using activity-based costing. (Round activity rate answers to 2 decimal places.) Answer is complete but not entirely correct. Estimated Costs to be allocated Estimat: mated Cost driver Cost driver quantity incurred Cost Activity Rate OH Allocated S 8,000 IS 32.000 direct labor costs S 4,700.00 per direct labor dollar S 1.875 S 18,700 X Indirect labor and supplies Rent, utilities general office and depreciation 19,200 3.200 machine hours 6.00 per machine hour 7.625 45.750 Total Overhead allocated IS 62,450
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