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Wallace Printing has contracts to complete weekly supplements required by forty-six customers. For the year 2019, manufacturing overhead cost estimates total $420,000 for an

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Wallace Printing has contracts to complete weekly supplements required by forty-six customers. For the year 2019, manufacturing overhead cost estimates total $420,000 for an annual production capacity of 10 million pages. For 2019 Wallace Printing decided to evaluate the use of additional cost pools. After analyzing manufacturing overhead costs, it was determined that number of design changes, setups, and inspections are the primary manufacturing overhead cost drivers. The following information was gathered during the analysis: Cost pool Design changes Setups Inspections Total manufacturing overhead costs Manufacturing overhead costs Activity level 200 design $60,000 changes 320,000 4,000 setups 40,000 16,000 inspections $420,000 During 2019, two customers, Wayward Insurance and Hapless Systems, are expected to use the following printing services: Activity Wayward Insurance Hapless Systems Pages 60,000 76,000 Design changes 10 2 Setups 20 10 Inspections 30 38 52) If manufacturing overhead costs are considered one large cost pool and are assigned based on 10 million pages of production capacity, what is the cost driver rate? A) $0.25 per page B) $0.05 per page C) $0.025 per page D) $0.042 per page E) $0.42 per page 53) Using pages printed as the only overhead cost driver, what is the manufacturing overhead cost estimate for Hapless Systems during 2019? A) $19,000 B) $3,800 C) $1,900 D) $2,520 E) $3,192 54) Assuming activity-cost pools are used, what are the activity-cost driver rates for design changes, setups, and inspections cost pools? A) $300 per change, $80 per setup, $2.50 per inspection B) $250 per change, $80 per setup, $3.75 per inspection C) $210 per change, $2.50 per setup, $26.25 per inspection D) $300 per change, $125 per setup, $4.00 per inspection E) $300 per change, $2.50 per setup, $80 per inspection 55) Using activity-based costing to allocate overhead costs, what is the total manufacturing overhead cost estimate for Hapless Systems during 2019? A) $3,113.75 B) $1,495.00 C) $2,068.00 A) activity-based costing. B) direct costing. C) job costing. D) process costing. E) normal costing.

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