Required information [The following information applies to the questions displayed below.] Hickory Company manufactures two products-13,000 units of Product Y and 5,000 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 $684,000 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: Estimated Overhead. Cost $ 235,200 $73,600 $ 80,000 $ 295,200 Activity Cost Pool Machining Machine setups Product design General factory Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Product Y Product Z 6,600 5,400 120 40 1 7,600 6,800 Expected Activity 12,000 MHS 160 setups 2 products 14,400 DLHS

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Required information
[The following information applies to the questions displayed below.]
Hickory Company manufactures two products-13,000 units of Product Y and 5,000 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 $684,000 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:
Estimated Overhead.
Cost
$ 235,200
$73,600
$ 80,000
$ 295,200
Activity Cost Pool
Machining
Machine setups
Product design
General factory
Activity Measure
Machine-hours
Number of setups
Number of products
Direct labor-hours:
Activity Measure
Machine-hours
Number of setups
Number of products
Direct labor-hours
Product Y Product Z
6,600
5,400
40
120
1
7,600
6,800
Expected Activity
12,000 MHS
160 setups
2 products
14,400 DLHS
Transcribed Image Text:Required information [The following information applies to the questions displayed below.] Hickory Company manufactures two products-13,000 units of Product Y and 5,000 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 $684,000 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: Estimated Overhead. Cost $ 235,200 $73,600 $ 80,000 $ 295,200 Activity Cost Pool Machining Machine setups Product design General factory Activity Measure Machine-hours Number of setups Number of products Direct labor-hours: Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Product Y Product Z 6,600 5,400 40 120 1 7,600 6,800 Expected Activity 12,000 MHS 160 setups 2 products 14,400 DLHS
Required:
1. What is the company's plantwide overhead rate?
Note: Round your answer to 2 decimal places.
Plantwide overhead rate
per DLH
Transcribed Image Text:Required: 1. What is the company's plantwide overhead rate? Note: Round your answer to 2 decimal places. Plantwide overhead rate per DLH
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