Question

1. Hercules Inc. manufactures elliptical exercise machines and treadmills. The products are produced in its Fabrication and Assembly production departments. In addition to production activities, several other activities are required to produce the two products. These activities and their associated activity rates are as follows:

   Activity	Activity Rate
   Fabrication	$24	per machine hour
   Assembly	$10	per direct labor hour
   Setup	$55	per setup
   Inspecting	$23	per inspection
   Production scheduling	$11	per production order
   Purchasing	$8	per purchase order

   The activity-base usage quantities and units produced for each product were as follows:

   Activity Base	Elliptical Machines		Treadmill
   Machine hours	1,792		1,057
   Direct labor hours	425		166
   Setups	45		14
   Inspections	714		428
   Production orders	76		15
   Purchase orders	182		111
   Units produced	291		195

   Use the activity rate and usage information to determine the total activity cost and activity cost per unit for each product. If required, round the per unit answers to the nearest cent.

   	Total Activity Cost	Activity Cost Per Unit
   Elliptical Machines	$	$
   Treadmill	$	$

Answer 1

Elliptical Machines

Fabrication	241792	$ 43008
Assembly	10425	$ 4250
Setup	5545	$ 2475
Inspecting	23714	$ 16422
Production Schedulling	1176	$ 836
Purchasing	1828	$ 1456
Total Activity Cost (1)		$ 68447
Total No Of Units produced (2)		291
Activity Cost Per Unit (1) (2)		$ 235.21

Treadmill

Fabrication	241057	$ 25368
Assembly	10166	$ 1660
Setup	5514	$ 770
Inspecting	23428	$ 9844
Production Schedulling	1115	$ 165
Purchasing	8111	$ 888
Total Activity Cost (1)		$ 38965
Total No Of Units produced (2)		195
Activity Cost Per Unit (1) (2)		$ 199.82

So the answer comes

	Total Activity Cost ($)	Activity Cost per Unit ($)
Elliptical machines	68447	235 (rounded to nearest cents)
Treadmill	38965	200 (rounded to nearest cents)