Reference no: EM132381096
Question
Air United, Inc. manufactures two products: missile range instruments and space pressure gauges. During April, 50 range instruments and 200 pressure gauges were produced, and overhead costs of $85,890 were estimated. An analysis of estimated overhead costs reveals the following activities.
Activities Cost Drivers Total Cost
1.Materials handlingNumber of requisitions$37,620
2.Machine setupsNumber of setups26,950
3.Quality inspectionsNumber of inspections21,320
$85,890
The cost driver volume for each product was as follows.
Cost Drivers
Instruments
Gauges
Total
Number of requisitions3856601,045Number of setups175315490Number of inspections275245520
Determine the overhead rate for each activity.
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