Schell Company manufactures automobile floor mats It currenty has two product in

Question

Schell Company manufactures automobile floor mats It currenty has two product ines, potential cost drivers. As a resun, the company has compied the folowing detailed information, breaking sotal overhead into three the Standad and the Deluxe Suppose that Schell has conducted further research into its overhead and by Driver d Floor Mat 6 moves 660 inspections 2,930 machine hours Floor 5 2,256 00 Number of inspections 9,372.00 Number of machine hours $12,138.00 handing Quality control Machine maintenance 660 inspections 4210 machine hours Required: 1. Calculate the activity rates for each cost pool assuming Schell uses an ABC system (Round your answers to 2 decimal places) per Material Move Material Handing Quality Control Machine maintenance per Machine Hour 2Cakculate the amount of overhead that Schell willassign to the Standard toor mat line (Round your intermediate calculations to 2 d your intermediate calculations to 2 decimal places)

Explanation / Answer

1 Activity rate Materials handling 24 per material move =2256/(36+58) Quality control 7.1 per inspection =9372/(660+660) Machine maintenance 1.7 per machine hour =12138/(2930+4210) 2 Standard Materials handling 864 =36*24 Quality control 4686 =660*7.1 Machine maintenance 4981 =2930*1.7 Total overhead assigned 10531 3 Deluxe Materials handling 1392 =58*24 Quality control 4686 =660*7.1 Machine maintenance 7157 =4210*1.7 Total overhead assigned 13235

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