HulaHug Corp., which manufactures hula hoops, currently has two product lines, t

Question

HulaHug Corp., which manufactures hula hoops, currently has two product lines, the Roundabout and the Sassafras. HulaHug has total overhead of $132,575.

     HulaHug has identified the following information about its overhead activity pools and the two product lines.

Suppose HulaHug used a traditional costing system with machine hours as the cost driver. Determine the amount of overhead assigned to each product line. (Do not round intermediate calculations and round your final answers to the nearest whole dollar amount. Omit the "$" sign in your response.)

Calculate the activity proportions for each cost pool in HulaHug's ABC system. (Round your answers to 2 decimal places. Omit the "$" signs in your response.)

Calculate the amount of overhead that HulaHug will assign to the Roundabout line if it uses an ABC system. (Round your intermediate calculations and final answers to 2 decimal places. Omit the "$" signs in your response.)

Determine the amount of overhead HulaHug will assign to the Sassafras line if it uses an ABC system. (Round your intermediate calculations and final answers to 2 decimal places. Omit the "$" signs in your response.)

HulaHug Corp., which manufactures hula hoops, currently has two product lines, the Roundabout and the Sassafras. HulaHug has total overhead of $132,575.

     HulaHug has identified the following information about its overhead activity pools and the two product lines.

Explanation / Answer

Hi,

Please find the answer as follows:

Material Handling Cost Per Move = 20655/(550 + 470) = 20.25

Quality Control Cost Per Inspection = 78720/(6300 + 3300) = 8.2

Machine Maintenance Cost Per Machine Hour = 33200/(16000 + 24000) = .83

Part 3:

Part 4

Thanks.

Material Handling (550*20.25) 11137.5 Quality Control (6300*8.2) 51660 Machine Maintenance (16000*.83) 13280 Total Overhead Assigned 76077.5

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