FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Greenwood Company manufactures two products-15,000 units of Product Y and 7,000 units of Product Z. The company
uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing
(ABC) system that allocates all of its manufacturing overhead to four cost pools. The following additional information is
available for the company as a whole and for Products Y and Z:
Expected
Activity
11, 000 MHS
270 setups
Estimated Overhead
Cost
Activity Cost Pool Activity Measure
227, 700
153, 900
Machine-hours
Number of setups
Number of
products
Direct labor-
%$4
Machining
Machine setups
Production design
91,000
2 products
General factory
257,000
10, 000 DLHS
hours
Activity Measure
Machining
Number of setups
Number of products
Direct labor-hours
Product Y
8, 700
60
Product Z
2, 300
210
1
8,700
1,300
11. Using the plantwide overhead rate, what percentage of the total overhead cost is allocated to Product Y and Product Z? (Round
your intermediate calculations to 2 decimal places. Round your answers to 2 decimal places.)
Product Y
Product Z
Total overhead cost
%
%24
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