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Four Finger Appliance Company manufactures small kitchen appliances. The product line consists of blenders and toaster ovens.


Four Finger Appliance used direct labor hours to allocate production department factory overhead to products. The management
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Answer #1
Computation of Activity Rate
Activity Cost Pool(a) No. of activity (b) Per Activity Allocation Rate(a/b)
Assembly (275736-81366) $194,370.00 2945 DLH $66.00
Test And Pack (201046-81366) $119,680.00 2720 DLH $44.00
Setup $162,732.00 191 Setup $852.00
Blenders:
Activity Allocation Usage (a) Activity Rate
(b)
Activity Cost
(a*b)
Assembly Department 740 $66.00 $48,840.00
Test and Pack Department 2,040 $44.00 $89,760.00
Setup 142 $852.00 $120,984.00
Total $259,584.00
Units $8,390.00
Factory Overhead Cost per Unit $30.94
Totaster
Activity Allocation Usage (a) Activity Rate
(b)
Activity Cost
(a*b)
Assembly Department 2205 $66.00 $145,530.00
Test and Pack Department 680 $44.00 $29,920.00
Setup 49 $852.00 $41,748.00
Total $217,198.00
Units $8,390.00
Factory Overhead Cost per Unit $25.89
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