EcoFabrics has budgeted overhead costs of $945,000. It has assigned overhead on a plantwide basis to its two products (wool and cotton) using direct labor hours which are estimated to be 450,000 for the current year. The company has decided to experiment with activity-based costing and has created two activity cost pools and related activity cost drivers. These two cost pools are cutting (cost driver is machine hours) and design (cost driver is number of setups). Total estimated machine hours is 200,000, and total estimated number of setups is 1,500. Overhead allocated to the cutting cost pool is $360,000 and $585,000 is allocated to the design cost pool. Additional information related to product usage by these pools is as follows. Machine hours Number of setups (a1) Design Wool Save for Later Calculate the overhead rate using activity based costing. (Round per machine hour to 2 decimal places, e.g. 12.25.) $ (a2) 100,000 100,000 1,000 Overhead rates for activity-based costing Cutting $ Cotton eTextbook and Media 500 per machine hour per setup Attempts: unlimited Submit Answer F

EcoFabrics has budgeted overhead costs of $945,000. It has assigned overhead on a plantwide basis to its two products (wool and cotton) using direct labor hours which are estimated to be 450,000 for the current year. The company has decided to experiment with activity-based costing and has created two activity cost pools and related activity cost drivers. These two cost pools are cutting (cost driver is machine hours) and design (cost driver is number of setups). Total estimated machine hours is 200,000, and total estimated number of setups is 1,500. Overhead allocated to the cutting cost pool is $360,000 and $585,000 is allocated to the design cost pool. Additional information related to product usage by these pools is as follows. Machine hours Number of setups (a1) Design Wool Save for Later Calculate the overhead rate using activity based costing. (Round per machine hour to 2 decimal places, e.g. 12.25.) $ (a2) 100,000 100,000 1,000 Overhead rates for activity-based costing Cutting $ Cotton eTextbook and Media 500 per machine hour per setup Attempts: unlimited Submit Answer F

Name: EcoFabrics has budgeted overhead costs of $945,000. It has assigned o
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Description: EcoFabrics has budgeted overhead costs of $945,000. It has assigned overhead on a plantwide basis to its two products (wool andcotton) using direct labor hours which are estimated to be 450,000 for the current year. The company has decided to experi

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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