Gold Company uses a plantwide overhead rate with machine hou

Gold Company uses a plantwide overhead rate with machine hours as the allocation base. Use the following information to solve for the amount of machine hours estimated per unit of product RST.

Multiple Choice

22.00 MH per unit of RST.

17.00 MH per unit of RST.

54.00 MH per unit of RST.

52.50 MH per unit of RST.

2.00 MH per unit of RST.

The following data relates to Spurrier Company\'s estimated amounts for next year.

What is the company\'s plantwide overhead rate if direct labor hours are the allocation base? (Round your answer to two decimal places.)

Multiple Choice

$3.83 per direct labor hour.

$0.37 per direct labor hour.

$2.55 per direct labor hour.

$0.58 per direct labor hour.

$3.70 per direct labor hour.

A company has two products: A1 and B2. It uses activity-based costing and has prepared the following analysis showing budgeted cost and activity for each of its three activity cost pools:

Annual production and sales level of Product A1 is 8,680 units, and the annual production and sales level of Product B2 is 22,510 units. What is the approximate overhead cost per unit of Product A1 under activity-based costing?

Multiple Choice

$10.00

$4.12

$8.78

$12.25

$7.81

Direct material cost per unit of RST	$	23
Total estimated manufacturing overhead	$	316,000
Total cost per unit of RST	$	88
Total estimated machine hours		158,000	MH
Direct labor cost per unit of RST	$	31

Solution

Gold Company: Calculation of Plan Wide Overhead Rate: A Total Estimated OH Cost 316000 B Total Estimated Machine Hours 158000 A/B Recovery Rate PerMH 2.00 Answer is 2.00 MH Spurrier Company: Calculation of Plan Wide Overhead Rate: A Total Estimated OH Cost 5040000 (Dep 1 +Dep2) B Total Estimated Machine Hours 1362000 (Dep 1 +Dep2) A/B Recovery Rate Per DLH 3.70 Answer is 3.70 Per DLH Problem 3: Calculation of Activity Rate for Each Pool: A Budgeted Activity B A/B Activity Cost Pools Budgeted Cost Product A1 Product B2 Total Activity Activity Rate Activity 1 50000 1400 5000 6400 7.81 Activity 2 65000 2440 4960 7400 8.78 Activity 3 84000 7400 1000 8400 10.00 199000 Allcoation of Cost to Product A1: A B A*B Activity Cost Pools Product A1 Activity Rate Allocated OH Activity 1 1400 7.81 10,938 Activity 2 2440 8.78 21,432 Activity 3 7400 10.00 74,000 Total Allcoation 1,06,370 Total Units 8680 Cost PU 12.25 Answer is 12.25