1. Lakeside Inc. manufactures four lines of remote control boats and uses activi

Question

1. Lakeside Inc. manufactures four lines of remote control boats and uses activity-based costing to calculate product cost. Estimated Total Cost $329,000 12,800 machine hours Estimated Cost Driver Activity Cost Pools Machining Setup Quality control 360 batches 71,000 98,000 740 inspections Compute the activity rates for each of the following activity cost pools: (Round your answers to 2 decimal places.) per Machine Hour Machining Setup Costs Quality Control per Batch per Inspection O Type here to search 20

Explanation / Answer

Computation ofd activity rates Activity cost pools Estimated total cost Estimated cost driver Activity rate Machining       3,29,000      12,800 machine Hours 25.70 Per machine Hour (329,000/12,800) Setup           71,000            360 Batches 197.22 Per Batch (71,000/360) Quality control           98,000            740 Inspections 132.43 Per Inspection (98,000/740) * Activity rate = Estimated total cost / Cost driver activity

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