FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Everlast Co. manufactures a variety of drill bits. The company's plant is partially automated. The budget for the year includes $432,000 payroll for 4,800 direct labor-hours. Listed below is cost driver information used
in the product-costing system:
Budgeted
Overhead Cost Pool
Overhead
Cost Driver
Estimated Cost Driver Level
Machine setups
Materials handling
Quality control
$120,000
# of setups
120 setups
8,700 barrels
1,100 inspections
12,000 machine hours
104,400
# of barrels
264,000
# of inspections
Other overhead cost
144,000
# of machine hours
Total overhead
$632,400
A current product order has the following requirements:
Machine setups
8 setups
Materials handling
606 barrels
Quality inspections
80 inspections
Machine hours
830 machine hours
Direct labor hour
336 hours
Using ABC, how much machine setup overhead is assigned to the order?
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Transcribed Image Text:Everlast Co. manufactures a variety of drill bits. The company's plant is partially automated. The budget for the year includes $432,000 payroll for 4,800 direct labor-hours. Listed below is cost driver information used in the product-costing system: Budgeted Overhead Cost Pool Overhead Cost Driver Estimated Cost Driver Level Machine setups Materials handling Quality control $120,000 # of setups 120 setups 8,700 barrels 1,100 inspections 12,000 machine hours 104,400 # of barrels 264,000 # of inspections Other overhead cost 144,000 # of machine hours Total overhead $632,400 A current product order has the following requirements: Machine setups 8 setups Materials handling 606 barrels Quality inspections 80 inspections Machine hours 830 machine hours Direct labor hour 336 hours Using ABC, how much machine setup overhead is assigned to the order?
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