Question

Required Information Gable Company uses three activity cost pools. Each pool has a cost driver. Information for Gable Company follows: Activity Cost Pools Machining Designing costs Setup costs Total Cost of Pool Cost Driver $312,eee Number of machine hours 73,6ee Number of design hours 71,600 Number of batches Estimated Cost Driver Be, evo 8, eae 500 Re 1. red: mpute the activity rate for each activity. 1551fy each activity as facility, product, batch, or unit level. complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the activity rate for each activity. (Round your answers to 2 decimal places.) Activity Rate Activity Mshining Design Costs per Machine Hour per Design Hour Setup per Batch Required 2 >

Answer 1

Requirement 1:- Using activity proportions, determine the amount of overhead assigned to each product.

	Total Overhead Assigned
Product A	$153,600
Product B	$197,620
Procduct C	$105,980

Compute the Total overhead

Total Cost Cost Driver Rate 312000 80,000 3.9 Machining Desingning Cost Setupcost 73,600 8,000 9.2 71,600 500 143.2 A Machining Rate Maching Cost Assigned B 30000 3.9 с 40000 3.9 10000 3.9 117000 156000 39000 3200 1800 3000 Desingning Cost Rate Desingning Cost Assigned 9.2 9.2 9.2 29440 16560 27600 50 143.2 175 143.2 275 143.2 Setupcost Rate Setupcost Cost Assigned 7160 25060 39380 A B с Total Overhead 153600 197620 105980

Requirement 2:- Compute the activity rate for each Activity.

Activity	Activity Rate
Machining	$3.9 per machine hour
Design Costs	$9.2 per design hour
Set up	$143.20 per Batch

Compute the activity rate

Total Cost 312000 Cost Driver Activity Rate 80,000 3.9 Machining Desingning Cost Setupcost 73,600 8,000 9.2 71,600 500 143.2

Machining = 312,000 / 80,000 = $3.9

Desinging = 73,600 / 8,000 = $9.2

Set up cost = 71,600 / 500 = $143.20

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