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Wilitte Pharmaceuticals manufactures an over-the-counter allergy medication called Breathe. Willitte is trying to win market share from Sudafed and Tylenol. The company has developed several
Wilitte Pharmaceuticals manufactures an over-the-counter allergy medication called Breathe. Willitte is trying to win market share from Sudafed and Tylenol. The company has developed several different Breathe products tailored to specific markets. For example, the company sells large commercial containers Willitte's controller, Samatha DeRidder, has just returned from a conference on ABC. She asks Kadeem Yand, supervisor of the Breathe product line to help her develop an ABC system. DeRidder and Yand identify the following activities, related costs, and cost allocation bases: (Click the icon to view the information.) Read the requirements Requirement 1. Determine the formula, then compute the cost allocation rate for each activity. (Round your answers to the nearest whole dollar. Abbreviations used: Mat.=Materials, QA=Quality assurance) Requirements 1. Compute the cost allocation rate for each activity. 2. Use the activity-based cost allocation rates to compute the indirect cost of each unit of the commercial containers and the travel packs. (Hint: Compu) 3. The company's original single-allocation-based co to $450 per machine hour. Comoute the total indirect costs allocated to indirect costs to products at and to the travel packs under the original system. Then compute the indirect cost per unit for each 4. Compare the activity-based costs per unit to the costs from the original system. How have the unit costs changed? Explain why the costs changed as they did Data table The commercial-container Breathe product line had a total weight of 8,729 kilos, used 900 machine hours, and required 230 samples. The travel-pack line had a total weight of 6,204 kilos, used 300 machine hours packs
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