Question

Thanks for the help accountants!!!!

Daston Company manufactures two products, Product F and Product G. The company expects to produce and sell 1,950 units of Product F and 2,510 units of Product G during the current year. Data relating to the company's three activity cost pools are given below for the current year: Activity Cost Pools Machine setups Purchase orders Order size Total Cost $ 25, 116 $242,820 $ 95,480 Product F 141 setups 900 orders 2,950 hours Total Activity Product G 132 setups 1,230 orders 3,870 hours Total 273 setups 2,130 orders 6,820 hours Required: Using the activity-based costing approach, determine the overhead cost per unit for each product. (Round your answers to 2 decimal places.) Overhead Cost Per Unit Product F Product G

Answer 1

	Overhead Cost Per Unit
Product F                 [Refer working note 1]	$80.45
Product G                [Refer working note 2]	$82.29

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Working note 1 - Computation of overhead cost per unit
	Product F	Product G
Total activity cost / overhead allocated        [Refer working note 2]             (a)	$156,872	$206,544
Production ( In units)                                                                     (b)	1,950	2,510
Overhead cost per unit                                                (a / b)	$80.45	$82.29

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Working note 2 - Allocation of overhead / activity cost
Activity	Activity Rate [Refer working note 3]		Product F			Product G
			Activity usage		Allocation of activity cost	Activity usage		Allocation of activity cost
	(a)		(b)		(a x b)	(c)		(a x c)
Machine setups	$92	per setup	141	setups	$12,972	132	setups	$12,144
Purchase orders	$114	per order	900	orders	$102,600	1,230	orders	$140,220
Order size	$14	#REF!	2,950	hours	$41,300	3,870	hours	$54,180
Total overhead assigned					$156,872			$206,544

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Working note 3 - Calculation of Activity rate
Activity	Budgeted activity cost (a)	Total Activity (b)		Activity rate (a / b)
Machine setups	$25,116	273	setups	$92	per setup
Purchase orders	$242,820	2,130	orders	$114	per order
Order size	$95,480	6,820	hours	$14	per hour