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Craftmore Machining reports the following budgeted overhead cost and related data for this year. Activity Assembly Budgeted Cost $575,250 88,500 29,500 Activity Cost Driver Direct labor hours (DLH) Engineering hours (EH) Machine hours (MH) Product design Budgeted Activity Usage 13,000 1,500 11,800 590 Electricity 73,750 Setups $ 767,000 Setup Total Required: 1. Compute a single plantwide overhead rate assuming the company allocates overhead cost based on 13,000 direct labor hours. 2. Job 31 used 320 direct labor hours and Job 42 used 680 direct labor hours. Allocate overhead cost to each job using the single plantwide overhead rate from part 1. 3. Compute an activity rate for each activity using activity-based costing.

Craftmore Machining reports the following budgeted overhead cost and related data for this year. Activity Assembly Budgeted Cost $575,250 88,500 29,500 Activity Cost Driver Direct labor hours (DLH) Engineering hours (EH) Machine hours (MH) Product design Budgeted Activity Usage 13,000 1,500 11,800 590 Electricity 73,750 Setups $ 767,000 Setup Total Required: 1. Compute a single plantwide overhead rate assuming the company allocates overhead cost based on 13,000 direct labor hours. 2. Job 31 used 320 direct labor hours and Job 42 used 680 direct labor hours. Allocate overhead cost to each job using the single plantwide overhead rate from part 1. 3. Compute an activity rate for each activity using activity-based costing.

Managerial Accounting
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter4: Activity-based Costing
Section: Chapter Questions
Problem 2E: Bach Instruments Inc. makes three musical instruments: flutes, clarinets, and oboes. The budgeted...
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Craftmore Machining reports the following budgeted overhead cost and related data for this year. Activity Assembly Product design Budgeted Cost $ 575,250 88,500 29,500 73,750 Activity Cost Driver Direct labor hours (DLH) Engineering hours (EH) Machine hours (MH) Setups Electricity $ 767,000 Setup Total Required: 1. Compute a single plantwide overhead rate assuming the company allocates overhead cost based on 13,000 direct labor hours. 2. Job 31 used 320 direct labor hours and Job 42 used 680 direct labor hours. Allocate overhead cost to each job using the single plantwide overhead rate from part 1. 3. Compute an activity rate for each activity using activity-based costing. 4. Allocate overhead costs to Job 31 and Job 42 using activity-based costing. Activity Cost Driver Direct labor hours (DLH) Engineering hours (EH) Machine hours (MH) Setups Activity Usage Job 31 320 45 60 6 Job 42 Budgeted Activity Usage 13,000 1,500 11,800 590 680 51 60 8
Transcribed Image Text:Craftmore Machining reports the following budgeted overhead cost and related data for this year. Activity Assembly Product design Budgeted Cost $ 575,250 88,500 29,500 73,750 Activity Cost Driver Direct labor hours (DLH) Engineering hours (EH) Machine hours (MH) Setups Electricity $ 767,000 Setup Total Required: 1. Compute a single plantwide overhead rate assuming the company allocates overhead cost based on 13,000 direct labor hours. 2. Job 31 used 320 direct labor hours and Job 42 used 680 direct labor hours. Allocate overhead cost to each job using the single plantwide overhead rate from part 1. 3. Compute an activity rate for each activity using activity-based costing. 4. Allocate overhead costs to Job 31 and Job 42 using activity-based costing. Activity Cost Driver Direct labor hours (DLH) Engineering hours (EH) Machine hours (MH) Setups Activity Usage Job 31 320 45 60 6 Job 42 Budgeted Activity Usage 13,000 1,500 11,800 590 680 51 60 8
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