Greenwood Company manufactures two products - 15,000 units of Product Y and 7,00

Question

Greenwood Company manufactures two products - 15,000 units of Product Y and 7,000 units of Product Z. The company uses a plantwide overhead rate based on direct labor hours. It is considering implementing an activity based costing system that allocates all of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products Y and Z

Using the plant wide overhead rate how Mich manufacturing overhead cost is allocated to product Y and Product Z? Round your intermediate calculations to 2 decimal places and final answers to the nearest dollar amount

Estimated Activty Cost Pool Mechiring Activity Messure Mechine-hours Number of setups Cot Expected Acsvicy $ 130 000 94000 $200000 300 sstup Produttion designNumber of products9 General factory 2 products 0000 OLHs Activity Meeute Mochining 60 240 Number of prode 000 1,000

Explanation / Answer

ALLOCATION OF OVERHEAD TO PRODUCT Y & Z

PARTICULLAR AMOUNT $ MACHINNING 231000 MACHINE SETUPS 180000 PRODUCTION DESIGN 94000 GENERAL FACTORY 200000 TOTAL EASTMEMETED OVERHEAD (A) 705000 TOTAL EASTMETED DIRECT LABOUR HOUR (B) 10000 PLANTWIDE OVERHEAD RATE PER DIRECT LABOUR HOUR ((A /B) 70.5

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