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Tableau DA 4-3: Mini-Case, Computing and assigning costs using ABC LOP3 wants to assign overhead costs to its two different m
Estimated Overhead Costs by Estimated Direct Labor Hours & Department Machine Hours by Department 150,000 hrs 125,000 hrs 100
Estimated Overhead Costs by Estimated Direct Labor Hours & Machine Hours by Department 150,000 hrs 125,000 hrs 100,000 hrs Fi
Estimated Overhead Costs by Department Estimated Direct Labor Hours & Machine Hours by Department 150,000 hrs 125,000 hrs Fin
Estimated Overhead Costs by Department Estimated Direct Labor Hours & Machine Hours by Department 125,000 hrs Finishing 100,0
Estimated Overhead Costs by Department Estimated Direct Labor Hours & Machine Hours by Department 150,000 hrs 125,000 hrs 100
Estimated Overhead Costs by Department Estimated Direct Labor Hours & Machine Hours by Department 150,000 hrs 125,000 hrs 100
Direct Labor Hours Machine Hours Estimated Overhead Costs by Activity Cost Driver & Expected Usage by Activity Supervision Su
Direct Labor Hours Machine Hours Estimated Overhead Costs by Activity Cost Driver & Expected Usage by Activity Supervision Su
Direct Labor Hours Machine Hours Estimated Overhead Costs by Activity Cost Driver & Expected Usage by Activity Supervision Ma
Direct Labor Hours Machine Hours Estimated Overhead Costs by Activity Cost Driver & Expected Usage by Activity Supervision Su
Tableau DA 4.3: Mini-Case, Assigning overhead costs and making decisions 2. The companys XL model requires 2 direct labor ho
Tableau DA 4-3: Mini-Case, Assigning overhead costs and making decisions 2. The companys XL model requires 2 direct labor ho
Tableau DA 4-3: Mini-Case, Assigning overhead costs and making decisions 2. The companys XL model requires 2 direct labor ho
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Answer #1

2A

Maintenance Activity Rate = Maintenance Activity Cost Pool/Activity Driver = $6000000/100000 labour hours = $60 per labour hour
Supervision Activity Rate = Supervision Activity Cost Pool/Activity Driver = $2000000/125000 labour hours = $16 per labour hour
XL RD
Activity Activity Rate Activity Dirver Incurred Overhead Assigned* Activity Dirver Incurred Overhead Assigned*
Maintenance 60 per MLH 1 MH 60 3 MH 180
Supervision 16 per DLH 2 DLH 32 3 DLH 48
Overhead Cost per unit 92 228
* Overhead assigned = Activity Rate* Activity Driver incurred

2B

Plantwide Overhead rate = Total Overhead Cost/ Total Labour hours = $8000000/125000
Model Activity Diver Plantwide OH Rate OH cost per unit*
XL 2 DLH 64 128
RD 3 DLH 64 192
*OH cost per unit = Activity Driver*Plantwide OH rate

2C

a. Which overhead Cost allocation method would the XL production manager prefer ABC*
b. Which overhead Cost allocation method would the RD production manager prefer Plantwide overhead rate*
*Production manager will prefer an overhead cost allocation method in which the overhead cost allocated to their product is lower.
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