Question

Fellar Corp. has identified the following information:

Activity cost pools
Materials handling	$53,100
Machine maintenance	21,000
Cost drivers
Number of material moves	900
Number of machine hours	84,000

Required:
1. Calculate the activity rate for each cost pool.
2. Determine the amount of overhead assigned to Fellar’s products if they have the following activity demands:

	Product A	Product B
Number of material moves	540	360
Number of machine hours	42,200	41,800

Calculate the activity rate for each cost pool.

	Activity Rate Material Handling per Material Move Machine Maintenance per Machine Hour

Determine the amount of overhead assigned to Fellar’s products if they have the following activity demands: (Round your intermediate calculations to 2 decimal places and final answers to the nearest whole dollar amount.)

	Product A	Product B
Number of material moves	600	360
Number of machine hours	42,000	33,000

	Total Overhead Assigned Product A Product B

Using activity proportions, determine the amount of overhead assigned to Fellar’s products. (Round your intermediate percentages to the nearest whole percent. Round final answers to the nearest whole dollar amount.)

	Total Overhead Assigned Product A Product B

Answer 1

Requirement 1 Compute the Activity Rate for each of activity cost pools: Activity Cost Pool Materials Handling Machine Maintenace Estimated Overhead cost (A) Expected Activity (B) Activity Rate (A/B) 53,100.00 900 $ 59.00 Per Material Move 21,000.00 84000 $ 0.25 Per Machine hour 74,100.00 Requirement 2 Determine the amount of overhead assigned to Fellar's products if they have the following activity demands: Product A Product B Number of Material moves 540 360 Per Material Move 59.00 $ 59.00 Total Overhead (A) $ 31,860.00 $ 21,240.00 Number of Machine Hours Per Machine hour Total Overhead (8) 42200 0.25 10,550.00 $ $ 41800 0.25 10,450.00 Total Overhead Cost (A+B) 42,410.00 $ 31,690.00 Determine the amount of overhead assigned to Fellar's products if they have the following activity demands: Product A Product B Number of Material moves 600 Per Material Move 59.00 $ 59.00 Total Overhead (A) 35,400.00 $ 21,240.00 360 Number of Machine Hours Per Machine hour Total Overhead (B) 42000 0.25 10,500.00 $ $ 33000 0.25 8,250.00 Total Overhead Cost (A+B) 45,900.00 $ 29,490.00