Question julio produces two kinds of calculator standard

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Reference no: EM13349734

Question :
Julio produces two kinds of calculator, standard and deluxe. The company is presently using a traditional costing system with machine hours as the cost driver but is considering a move to activity-based costing. In preparing for the possible switch, Julio has recognized two cost pools: materials handling and setup. The collected data follow:

Standard Model Deluxe Model

Number of machine hours: 57,500 60,000

Number of material moves: 580 780

Number of setup:s 120 725

Total estimated overhead costs are $503,250, of which $224,400 is assigned to the material handling cost pool and $278,850 is assigned to the setup cost pool.

Required :

1. Determine the overhead assigned to each product using the traditional cost system.

2. Evaluate the overhead assigned to each product using ABC

Reference no: EM13349734

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