Question

Flynn Industries has three activity cost pools and two products. It estimates production 2,000 units of Product BC113 and 1,000 of Product AD908. Having identified its activity cost pools and the cost drivers for each pool, Flynn accumulated the following data relative to those activity cost pools and cost drivers. Annual Overhead Data Activity Cost Pools Machine setup Machining Packing Cost Drivers Setups Machine hours Orders Estimated Overhead $14,800 78,560 27,030 Estimated Use of Cost Drivers per Product Estimated Use of Cost Product Product Drivers per Activity BC113 AD908 37 30 4,910 1,140 3,770 530 160 370 Using the above data, do the following: Prepare a schedule showing the computations of the activity-based overhead rates per cost driver. Activity Cost Pools Estimated Overhead Estimated Use of Cost Drivers per Activity Activity-Based Overhead Rates Machine setup setups per setup Machining machine hours per machine hr. . Packing orders per order

Answer 1

Activity Cost Pools	Estimated Overhead	Estimated Use of Cost	Activity - Based
		Drivers per actibity	Overhead Rates
Machine Setups	$14,800	37 Setups	$400	per setups
Machining	$78,560	4,910 machine hours	$16	per machine hours
Packing	$27,030	530 orders	$51	per order
	$1,20,390
	BC113			AD908
Activity Cost Pools	Estimated use of cost driver	Activity - Based	Cost Assigned	Estimated use of cost driver	Activity - Based	Cost Assigned
	per product	Overhead Rates		per product	Overhead Rates
Machine Setups	30	$400	$12,000	7	$400	$2,800
Machining	1140	$16	$18,240	3770	$16	$60,320
Packing	160	$51	$8,160	370	$51	$18,870
Total Assigned Costs			$38,400			$81,990
	BC113	AD908
Overhad Costs assigned	$38,400	$81,990
Estimated Production	2,000	1,000
Overhad Costs per unit	$19.20	$81.99