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Widget Company makes two products: Regular and Custom. Budget figures for 2020 are below. Overhead will be calculated using Activity Based Costing. Required: Prepare ABC
Widget Company makes two products: Regular and Custom. Budget figures for 2020 are below. Overhead will be calculated using Activity Based Costing. Required: Prepare ABC overhead rates. Use Direct Labour Hours as a driver for facility costs. Compute per unit production costs for each product Answer below or with an excel spreadsheet. per unit Regular Custom UNITS 8,000 2,400 Direct Materials $200 $400 DL Hours @ 8 $25/Hr MFG Overhead $2,560,000 16 Annual Overhead Data Estimated Use Activity Cost Cost Drivers Est. O/H Regular Custom Pools Receiving Orders $200,000 300 500 Machine set-up Set-ups $434,568 100 700 Machine Machining $1,066,560 16,000 9,600 hours Facility Costs DL Hours $858,872
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