Reference no: EM13600720

Munoz Corporation uses activity-based costing to determine product costs for external financial reports. At the beginning of the year, management made the following estimates of cost and activity in the company's five activity cost pools:

Activity cost pool Activitymeasure         EstimatedOH Cost         Expected Activity
Labor related Direct labor hours                  210000                     35,000 DLHs
Purchase orders Number or orders              72000                       900 orders
Product testing Number of test                    168000                    1,400 tests
Template Etching Number of templates        315000                    10,500 templates
General factory Machine hours                     840000                    70,000 MHS

Required:

1) Compute the activity rate for each of the activity cost pools.
2) During the year, actual overhead cost and acyivity were recorded as follows

Requirement 2: During the year, actual overhead cost and activity were recorded as follows: Activity Cost Pool Actual Overhead Cost Actual Activity Labor related $ 205,000 32,000 DLHs Purchase orders 74,000 950 orders Product testing 160,000 1,300 tests Template etching 338,000 11,500 relays General factory 825,000 68,000 MHs Total manufacturing overhead cost $ 1,602,000 a. Prepare a journal entry to record the incurrence of actual manufacturing overhead cost for the year.Post the entry to the company's Manufacturing Overhead T-account.