he following cost information is available for David, Ltd.: Activity Allocation Base Volume of Activity Overhead Cost Purchasing Purchase orders 25,000 $150,000 Receiving Shipments received 17,000 68,000 Machine setups Setups 3,000 190,000 Quality control Inspections 20,000 100,000 Direct materials are $15 per unit for luxury handbags and $10 per unit for deluxe handbags. There were 12,000 direct labor hours. Each of which was charged to inventory at $18 per hour. Required: Calculate the overhead rate using activity-based costing for the Purchasing Activity. $6.50 per purchase order $6 per purchase order $5 per purchase order $4 per purchase order
he following cost information is available for David, Ltd.: Activity Allocation Base Volume of Activity Overhead Cost Purchasing Purchase orders 25,000 $150,000 Receiving Shipments received 17,000 68,000 Machine setups Setups 3,000 190,000 Quality control Inspections 20,000 100,000 Direct materials are $15 per unit for luxury handbags and $10 per unit for deluxe handbags. There were 12,000 direct labor hours. Each of which was charged to inventory at $18 per hour. Required: Calculate the overhead rate using activity-based costing for the Purchasing Activity. $6.50 per purchase order $6 per purchase order $5 per purchase order $4 per purchase order
Chapter6: Activity-based, Variable, And Absorption Costing
Section: Chapter Questions
Problem 5PB: Wrappers Tape makes two products: Simple and Removable. It estimates it will produce 369,991 units...
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QUESTION 33
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The following cost information is available for David, Ltd.:
Activity
Allocation Base
Volume of Activity
Overhead CostPurchasing
Purchase orders
25,000
$150,000
Receiving
Shipments received
17,000
68,000
Machine setups
Setups
3,000
190,000
Quality control
Inspections
20,000
100,000
Direct materials are $15 per unit for luxury handbags and $10 per unit for deluxe handbags. There were 12,000 direct labor hours. Each of which was charged to inventory at $18 per hour.
Required: Calculate the overhead rate using activity-based costing for the Purchasing Activity.
$6.50 per purchase order
$6 per purchase order
$5 per purchase order
$4 per purchase order
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