Reference no: EM13917110
Hickory Company manufactures two products-13,000 units of Product Y and 5,000 units of Product Z. The company uses a plant wide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates all of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products Y and Z:
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Activity Cost Pool
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Activity Measure
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Estimated Overhead Cost
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Expected Activity
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Machining
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Machine-hours
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$
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242,400
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12,000
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MHs
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Machine setups
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Number of setups
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$
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114,400
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220
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setups
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Production design
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Number of products
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$
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86,000
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2
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products
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General factory
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Direct labor-hours
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$
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302,400
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14,400
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DLHs
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Activity Measure
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Product Y
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Product Z
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Machine-hours
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7,200
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4,800
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Number of setups
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40
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180
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Number of products
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1
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1
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Direct labor-hours
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8,200
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6,200
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What is the company's plant wide overhead rate?
Using the plant wide overhead rate, how much manufacturing overhead cost is allocated to Product Y and Product Z?
What is the activity rate for the Machining activity cost pool?
What is the activity rate for the Machine Setups activity cost pool?
What is the activity rate for the Product Design activity cost pool?
What is the activity rate for the General Factory activity cost pool?
Using the ABC system, how much total manufacturing overhead cost would be assigned to Product Y?
Using the ABC system, how much total manufacturing overhead cost would be assigned to Product Z?
Using the plant wide overhead rate, what percentage of the total overhead cost is allocated to Product Y and Product Z?
Using the ABC system, what percentage of the Machining costs is assigned to Product Y and Product Z?
Using the ABC system, what percentage of Machine Setups cost is assigned to Product Y and Product Z?
Using the ABC system, what percentage of the Product Design cost is assigned to Product Y and Product Z?
Using the ABC system, what percentage of the General Factory cost is assigned to Product Y and Product Z?
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