Calculate the cost per unit of activity for each activity

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Reference no: EM133062375

Question - Two-Stage ABC for Manufacturing - Merlot Company has determined its activity cost pools and cost drivers to be the following:

Cost Pools

Setup $84,000

Material handling 19,200

Machine operation 360,000

Packing 60,000

Total indirect manufacturing costs $523,200

Cost drivers

Setups 350

Material moves 640

Machine hours 20,000

Packing orders 1,200

One product made by Merlot, metal casements, used the following activities during the period to produce 500 units:

Setups 20

Material moves 80

Machine hours 1,900

Packing orders 150

Required -

a. Calculate the cost per unit of activity for each activity cost pool for Merlot Company.

b. Calculate the manufacturing overhead cost per metal casement manufactured during the period. Round cost per unit to two decimal places, if needed.

Reference no: EM133062375

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