Question

Total Budgeted Manufacturing Overhead Cost Allocation Base Activity Materials handling $ Number of parts Machine setup 13,200 5,200 49,500 86,100 Number of setups Number of parts Insertion of parts Finishing Finishing direct labor hours $ 154,000 Total Print Done * Requirements 1. Compute the cost allocation rate for each activity. 2. Compute the manufacturing overhead cost that should be assigned to Job 420. 3. Compute the manufacturing overhead cost that should be assigned to Job 510 Print Done

Answer 1

Answer :- Problem relating to activity Base costing cost Allocation Rate for each computation of Activity Insertion of finishing Particular material Handling machine set-up Parts |(A) Overhead Incurred $ 13200 $ $200 $ 49500 $ 86100 (B) Cost Driver No. of Parts Number of Number of finished Parts Direct Labour Hose set-up (C) Number of Times an Activities Perform 3300 Parts 2o setup 3300 Parts 2100 Hrs. (D) Formula material Han- machine Insertion of Finishing set-up parts cost No. of setup No. of Parts finished Direct Labour Hours odling No. of parts (E) Activity cost (AC) Dhrer $4 per part | $260 per setup sis per part $ 41 per Hrs (13200 3300)|(5200 ; 20) (49500; 3300) ($86100=2100) (1) computation of manufacturing overhead cost for Job 420 Particular No. of Activity cast Driver (0) = (3x ) Amount (A) material Handling cast 200 parts $4 per part $ 800 (B) machine set-up cost s set up $ 200 per set up $300 (c) Insertion of parts cost 200 Parts $ 15 per par $ 3000 (0) Finishely cost 110 Hos $ul per Ho. $ 4510 Total cost 1$ 9610

lillo computation of manufacturing Oh. Cost for Job 510 (A) Particular (D) > (gxo) Amount No. of Activity cost Driver (A) material Handling cost 45o Parts per part $1800 6 set-up (B) machine set-up cost (6) Insertion of Part cost $260 per set up $1560 uso Parts $ 15 per part $6750 (0) Finishing cast 310 Hours $ 41 per Hours $12710 Total cost $22820 conclusion of Part Ist (A) material Handling 1320 / 3300 = $ 4 per part (B) machine set up S200 1 = $260 per set up (c) Insertion cost Yosoo 3 300 (P) finishing = $is per part 86100 2100 $ul per hos.