Fogerty company makes two products, titanium hubs and sprockets. data regarding the two products follow:
direct
labor-hours per unit annual
production
hubs 0.70 13,000 units
sprockets 0.30 50,000 units
additional information about the company follows:
a.
hubs require $29 in direct materials per unit, and sprockets require $17.
b. the direct labor wage rate is $19 per hour.
c. hubs are more complex to manufacture than sprockets and they require special equipment.
d. the abc system has the following activity cost pools:
estimated activity
activity cost pool (activity measure) overhead cost hubs sprockets total
machine setups (number of setups) $ 27,000 125 100 225
special processing (machine-hours) $ 175,500 3,900 0 3,900
general factory (organization-sustaining) $ 219,100 na na na
1. compute the activity rate for each activity cost pool.
activity cost pool activity rate
machine setups per setup
special processing per mh
2. determine the unit product cost of each product according to the abc system.
hubs sprockets
direct materials ? ?
direct labor ? ?
overhead ? ?
unit cost ? ?