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Determine the activity rates for each activity

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Question - Activity-Based Costing - Mainline Marine Company has total estimated factory overhead for the year of $2,090,000, divided into four activities: fabrication, $750,000; assembly, $240,000; setup, $600,000; and inspection, $500,000. Mainline manufactures two types of boats: a speedboat and a bass boat. The activity-base usage quantities for each product by each activity are as follows:

 

Fabrication

Assembly

Setup

Inspection

Speed boat

1,200dlh

1,800dlh

60 setups

600 inspections

Bass boat

1,800

1,200

100

200

 

3,000 dlh

3,000 dlh

160 setups

800 inspections

Each product is budgeted for 200 units of production for the year.

Required -

a. Determine the activity rates for each activity.

b. Determine the factory overhead cost per unit for each product, using activity-based costing.

Reference no: EM132846567

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