Solution-How much overhead costs were applied

How much overhead costs were applied

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Reference no: EM132861968

Question - The Mega Construction Company recently switched to activity-based costing (ABC) from the department allocation method. The department method allocated overhead costs at a rate of $60 per machine hour. The cost accountant for the Finishing Department has gathered the following data:

Activity	Cost Drivers	Rate
Material handling	Tons of material handled	$80
Machine setups	Number of production runs	3,750
Utilities	Machine hours	25
Quality control	Number of inspections	$500

During April, Mega purchased and used $100,000 of direct materials at $20 per ton. There were 8 production runs using a total of 12,000 machine hours in April. The manager of the Finishing Department needed 12 inspections. Actual overhead costs totaled $820,000 for the month.

Required - How much overhead costs were applied to the Work-in-Process Inventory during April using activity-based costing?

Reference no: EM132861968

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How much overhead costs were applied

Reference no: EM132861968

Reference no: EM132861968

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