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Your answer is correct. Smithson, Inc. decided to implement the activity-based costing approach and was quite successful in its use. However, the controller is wondering
Your answer is correct. Smithson, Inc. decided to implement the activity-based costing approach and was quite successful in its use. However, the controller is wondering if instead of only two activity cost pools, they should expand to three activity cost pools based on the following Direct labor costs Machine hours Setup hours Packaging hours Family Model $71,100 2,000 200 50 Deluxe Model $142,200 2,000 800 75 The estimated overhead of $426,600 is allocated as follows: machining activity cost pool 227,520, machine set up $161,160 and packaging $37,920 Determine the overhead rates using the activity-based costing approach with three cost pools. (Round answers to 2 decimal places, e.g. 15.25.) Overhead Rate Machining 56.88 per hour per hour per hour Machine set up 161.16 Packaging 303.36
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