Question

Flynn Industries has three activity cost pools and two products. It estimates production 2,000 units of Product BC113 and 1,000 of Product AD908. Having identified its activity cost pools and the cost drivers for each pool, Flynn accumulated the following data relative to those activity cost pools and cost drivers. Annual Overhead Data Estimated Use of Cost Drivers per Product Activity Cost Pools Cost Drivers Estimated Overhead Estimated Use of Cost Drivers per Activity Product BC113 Product AD908 Machine setup Setups $21,000 35 20 15 Machining Machine hours 78,720 4,920 1,080 3,840 Packing Orders 28,520 460 160 300 Using the above data, do the following:

Prepare a schedule showing the computations of the activity-based overhead rates per cost driver. Activity Cost Pools Estimated Overhead Estimated Use of Cost Drivers per Activity Activity-Based Overhead Rates Machine setup $ setups $ per setup Machining machine hours $ per machine hr. Packing orders $ per order $ LINK TO TEXT

Prepare a schedule assigning each activity’s overhead cost to the two products. BC113 AD908 Activity Cost Pools Estimated Use of Cost Drivers per Product Activity-Based Overhead Rates Cost Assigned Estimated Use of Cost Drivers per Product Activity-Based Overhead Rates Cost Assigned Machine setup $ $ $ $ Machining $ $ Packing $ $ Total assigned costs $ $ LINK TO TEXT

Compute the overhead cost per unit for each product. (Round answers to 2 decimal places, e.g. 12.25.) BC113 AD908 Overhead cost per unit $ $

Answer 1

Prepare a schedule showing the computations of the activity-based overhead rates per cost driver. Activity Cost Pools Estimated Overhead Estimated Use of Cost Drivers per Activity Activity-Based Overhead Rates Machine setup $210000 35 setups $6000 per setup Machining 78720 4920 machine hours $16 per machine hr. Packing 28520 460 orders $62 per order $317240 LINK TO TEXT

Prepare a schedule assigning each activity’s overhead cost to the two products. BC113 AD908 Activity Cost Pools Estimated Use of Cost Drivers per Product Activity-Based Overhead Rates Cost Assigned Estimated Use of Cost Drivers per Product Activity-Based Overhead Rates Cost Assigned Machine setup 20 $6000 $120000 15 $ 6000 $90000 Machining 1080 $16 17280 3840 $16 61440 Packing 160 $62 9920 300 $62 18600 Total assigned costs $147200 $170040 LINK TO TEXT

Compute the overhead cost per unit for each product. (Round answers to 2 decimal places, e.g. 12.25.) BC113 AD908 Overhead cost per unit 147200/2000 = 73.60 170040/1000 = 170.04