Question

Hammer Time Asia has three divisions China, Thailand, and Japan Department Expense Actual Cost Activity Base International training $2,950,500 Trip days Export Fees $2,190,000 Shipments Document Center $734,400 Hours Japan 1,168 China Trip days 4,803 Shipments 168 Hours 610 How much is the total cost of the Thailand division? Thailand 1,054 47 35 210 880

		$888,888
		$1,234,560
		$1,296,733
		$3,752,460 Please help with showing work

Answer 1

Solution:

Department expense	Actual cost	Total Activity Base		Activity Rate
International Training	$29,50,500	$7,025	Trip days	$420.00	of direct labor cost
Export fees	$21,90,000	250	shipments	$8,760.00	Per hour
Document Center	$7,34,400	1700	hours	$432.00	per setup

Computation of Overhead allocated to Thailand Division
	Activity Rate			Activity driver Incurred	Overhead Assigned
Depreciation of machinery	$420.00	per trip day		1054	$4,42,680
Depreciation of machinery	$8,760.00	per shipment		47	$4,11,720
Assembly line preparation	$432.00	per hour		880	$3,80,160
Total					$12,34,560

Hence second option is correct.