Required information [The following information applies to the questions displayed below.] Rusties Company recently implemented an activity-based costing system. At the beginning of the year, management made the following estimates of cost and activity in the company's five activity cost pools: Activity Cost Pool Labor-related Purchase orders. Product testing Template etching General factory Activity Measure Direct labor-hours Number of orders Number of tests Number of templates Machine-hours Expected Overhead Cost $ 30,115 $ 2,320 $ 6,930 $ 870 $ 65,100 Expected Activity 1,585 DLHS 580 orders 330 tests 30 templates 9,300 MHS

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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[The following information applies to the questions displayed below.]
Rusties Company recently implemented an activity-based costing system. At the beginning of the year, management made
the following estimates of cost and activity in the company's five activity cost pools:
Activity Cost Pool
Labor-related
Purchase orders
Product testing
Template etching
General factory
Activity Cost Pool
Labor-related (DLHS)
Activity Measure
Product A
Product B
Product C
Product D
Direct labor-hours
Number of orders
Number of tests
Number of templates
Machine-hours
Total Overhead
Cost
Expected
Overhead
Cost
$ 30,115
$ 2,320
$ 6,930
$ 870
$ 65,100
2. The expected activity for the year was distributed among the company's four products as follows:
Product A
625
30
190
Expected Activity
1,585 DLHS
Product B
160
Purchase orders (orders)
190
Product testing (tests)
55
Template etching (templates)
17
3
General factory (MHS)
3,600
1,700
2,300
Using the ABC data, determine the total amount of overhead cost assigned to each product.
Expected Activity
Product C
580 orders
330 tests
30 templates
400
170
9,300 MHs
10
1,700
Product D
400
190
85
Transcribed Image Text:Required information [The following information applies to the questions displayed below.] Rusties Company recently implemented an activity-based costing system. At the beginning of the year, management made the following estimates of cost and activity in the company's five activity cost pools: Activity Cost Pool Labor-related Purchase orders Product testing Template etching General factory Activity Cost Pool Labor-related (DLHS) Activity Measure Product A Product B Product C Product D Direct labor-hours Number of orders Number of tests Number of templates Machine-hours Total Overhead Cost Expected Overhead Cost $ 30,115 $ 2,320 $ 6,930 $ 870 $ 65,100 2. The expected activity for the year was distributed among the company's four products as follows: Product A 625 30 190 Expected Activity 1,585 DLHS Product B 160 Purchase orders (orders) 190 Product testing (tests) 55 Template etching (templates) 17 3 General factory (MHS) 3,600 1,700 2,300 Using the ABC data, determine the total amount of overhead cost assigned to each product. Expected Activity Product C 580 orders 330 tests 30 templates 400 170 9,300 MHs 10 1,700 Product D 400 190 85
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