- X Scannell Industries manufactures a variety of custom products. The company has traditionally used a plantwide manufacturing overhead rate based on machine hours to allocate manufacturing overhead to its products. The company estimates that it will incur S1,500,000 in total manufacturing overhead costs in the upcoming year and will use 15.000 machine hours. Click the icon to view the additional information about the hazardous waste disposal fees.) Data table Estimated Activity for this Year 15,000 5,000 CHE wwwww IVUM Description of Cost Pool Estimated Cost Cost Driver Machine maintenance costs 600,000 Number of machine hours Engineering change orders $ 150,000 Number of change orders Hazardous waste disposal. $ 750,000 Pounds of hazardous materials generated $ 1,500,000 Total overhead cost............. FVV Calculate the cost of Job 356. 2,500 Job Cost Record Manufacturing Costs JOB 356 Direct materials 12,500 Direct labor 1.250 Print Done Manufacturing overhead allocated 12,000 $ 25,750 Total job cost Requirement 2. Calculate the cost of Job 356 using activity-based costing Begin by calculating the allocation rate for each activity. First determine the formula to compute the allocation rate in an activity-based costing system, then compute the rate for each activity. (Abbreviations used: est. = estimated, MH=machine hours, Mach.=Machine, Eng.=Engineering) Activity cost allocation rate = Total est activity cost pool 600.000 Total est activity allocation base 15,000 - X $ 40 Data table per MH Mach, maintenance $ Eng. change orders $ Waste disposal $ 150,000 5,000 $ 30 per order 750,000 2.500 = $ 300 per pound Calculate the cost of Job 356 using activity-based costing. 250 pounds of direct materials at $50 per pound 50 direct labor hours used at $25 per labor hour 120 machine hours used 11 change orders 60 pounds of hazardous waste generated Job Cost Record Manufacturing Costs JOB 356 Direct materials 12500 Direct labor 1250 Manufacturing overhead allocated 25750 Total job cost Print Done