Felcher, Ine. uses activity based costing to account for its chrome bumper manuf
ID: 2566366 • Letter: F
Question
Felcher, Ine. uses activity based costing to account for its chrome bumper manufacturing process. Company managers have identified four manufacturing activities: materials handing, machine setup, insertion of parts, and finishing. The budgeted activity costs for 2018 and their allocation bases are as folows: (Click the icon to view the budgeted costs and activity bases.) Read the requirements Requirement 1. Compute the predetermined overhead alocation rate for each activity. Begin by selecting the forrmula to calculate the predetermined overhead (OH) allocation rate. Then enter the amounts to compute the allocation rate for each actvity. (Round your answers to the nearest cent.) Predetermined OH Estimated overhead costs Estimated qty of the allocation base 4,000 alocation rate Materials handing Machine setup Insertion of parts Finishing Requirement 2. Compute the expected indrect manufacturing cost of each bumper Begin by selecting the formula to alocate overhead (OH) costs 10,000 3,000 52,000 72,000 2.50 $ 600.00 $1300 =$. 60.00 4,000 Data Table 1,200 Activity Materials handling Machine setup Insertion of parts Finishing Total Total Budgeted Cost 10,000 3,000 52,000 72,000 137,000 Allocation Base Number of parts Number of setups Number of parts Finishing direct labor hours S Expected qty of the allocation base used x Predetermined OH allocation rate Alocated mig. overhead costs Now compute the expected indirect manufacturing cost of each bumper. (Round the cost per bumper to the nearest cent.) Allocated Mig OH Cost Materials handling Machine setup Insertion of parts Fercher expects to produce 500 chrome bumpers dunng the year. The bumpers are expected to use 4,00O0 parts, require 5 setups, and consume 1,200 hours of finishing tme. Print Done Total mig. OH costs Number of bumpers 500 OH cost per bumperExplanation / Answer
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Predet OH RATE Allocation base TOTAL Material Handling 2.5 4000 10,000 Machine setup 600 5 3,000 Insertion of parts 13 4000 52,000 Finishing 60 1200 72,000 Total MFG OH COST 137,000 Number of Bumpers 500 Mfg OH Cost per bumper 274Related Questions
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