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Wellington Chocolate Company uses activity-based costing (ABC). The controller identified two activities and their budgeted costs: $728,000 Setting up equipment Other overheard $3,120,000 Setting up
Wellington Chocolate Company uses activity-based costing (ABC). The controller identified two activities and their budgeted costs: $728,000 Setting up equipment Other overheard $3,120,000 Setting up equipment is based on setup hours, and other overhead is based on oven hours. Wellington produces two products, Fudge and Cookies. Information on each product is as follows: Fudge Cookies Units produced 8,000 445,000 Setup hours 10,400 2,600 Oven hours 2,600 18,200 Required: Round your answers to the nearest whole dollar, unless otherwise directed, 1. Calculate the activity rate for (a) setting up equipment and (b) other overhead. a. Setting up equipment per setup hour b. Other overhead per oven hour 2. How much total overhead is assigned to Fudge using ABC? 3. What is the unit overhead assigned to Fudge using ABC? Round to the nearest cent. per unit
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