WoolCorp is currently using the single plantwide factory overhead rate method, which uses a predetermined overhead rate based on an estimated allocation base such as direct labor hours or machine hours. The rate is computed as follows:

Single Plantwide Factory Overhead Rate

= (Total Budgeted Factory Overhead) (Total Budgeted Plantwide Allocation Base)

WoolCorp has been using combing machine hours as its allocation base.

The company would like to consider activity-based costing. In order to understand their current system better, you evaluate WoolCorp's current method of costing for raw wool and wool yarn. The production staff has compiled the following information for you on the production of 450 pounds of either raw wool or wool yarn:

Factory Overhead Type

Budgeted Factory Overhead

Sorting $25,600

Cleaning38,400

Combing1,300

Raw WoolWool Yarn

Hours of combing machine use required 7030

In the following table, use combing machine hours as the allocation base for assigning overhead costs to each product. When required, round your answers to the nearest dollar.

What is the Single Plantwide Factory Overhead Rate per combing hr?

What is the Allocated factory overhead costfor Raw Wool?For Wool Yarn?

In order to compare WoolCorp's current method with activity-based costing, you interview the production staff and compile the following information, which relates to the costs for raw wool and wool yarn.

Type of CostActivity BaseTotal Cost

SortingHours of sorting $25,600

CleaningUnits of cleaning machine power 38,400

CombingHours of combing machine use 1,300

Raw WoolWool Yarn

Hours of sorting required1,0004,000

Units of cleaning machine power required1,8004,200

Hours of combing machine use required 7030

Can you help me calculate and enter the activity rate for each of the three activities.

ActivityActivity Rate

Sorting$ per sorting hour

Cleaning$ per unit of cleaning machine power

Combing$ per hour of combing machine use

Can you help me understand how to allocate the costs of sorting, cleaning, and combing based on the rates of activity consumed by each product's process.

Raw WoolWool Yarn

Sorting cost$$

Cleaning cost$$

Combing cost$$

Total cost$$