Rustafson Corporation is a diversified manufacturer of consumer goods. The compa

Question

Rustafson Corporation is a diversified manufacturer of consumer goods. The company's activity-based costing system has the following seven activity cost pools Estimated Overhead Cost Activity Cost Pool Labor-related Machine-related Machine setups Production orders Product testing Packaging General factory Expected Activity $29,200 $ 7,000 $18,000 $24,000 $24,000 $47,600 $59,600 4,000 direct labor-hours 7,000 machine-hours 500 setups 500 orders 1,200 tests 3,400 packages 4,000 direct labor-hours value: 10.00 points Required: 1. Compute the activity rate for each activity cost pool. (Round your answers to 2 decimal places.) Activity Cost Pool Labor-related Machine-related Machine setups Production orders Product testing Packaging General factory Activity Rate per DLH per MH per setup per order per test per package per DLH

Explanation / Answer

Activity cost pool Activity rate Labour - related ($29,200/4,000) $             7.30 per DLH Machine related ($7,000 / 7,000) $             1.00 per MH Machine setups ($18,000 / 500) $          36.00 per setup Production orders ($24,000 / 500) $          48.00 per order Product testing ($24,000 / 1,200) $          20.00 per test Packaging ($47,600 / 3,400) $          14.00 per package General Factory ($59,600 / 4,000) $          14.90 per DLH

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