Homework Answers
Correct answer-----------$22.97
Working
| Calculation of Activity rates | |||||
| Activity Cost Pool | Activity driver | Overhead Cost (A) | Expected Activity (B) | Activity rate (A/B) | |
| Materials handling | Number of Part | $ 3,300 | 3000 | $ 1.10 | Per Part |
| Assembling | Number of Part | $ 4,800 | 3000 | $ 1.60 | Per Part |
| Packaging | Number of Boat | $ 6,000 | 1300 | $ 4.62 | Per Boat |
.
| Cost assigned to Boat | |||
| Activity name | Activity Rates | Activity | ABC Cost |
| (A) | (B) | (A x B) | |
| Materials handling | $ 1.10 | 4.00 | $ 4.40 |
| Assembling | $ 1.60 | 4.00 | $ 6.40 |
| Packaging | $ 4.62 | 1.00 | $ 4.62 |
| Total Overheads assigned per boat | $ 15.42 | ||
.
| Boat | |
| Direct material | $ 7.55 |
| Direct labor | $ - |
| Overheads | $ 15.42 |
| Total Cost per unit | $ 22.97 |
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