Sabby Industries has three activity cost pools and two products. It expects to produce 2,900 units of Product S209 and 1.200 of Product NZ16. Having identified its activity cost pools and the cost drivers for each pool, Sabby accumulated the following data relative to those activity cost pools and cost drivers. Activity Cost Pool Machine set-ups Assembling Inspection (a) Calculate the overhead rates. Cost Driver Set-ups Machine hours Inspections Machine set-ups $ Assembling Inspection $ Estimated Overhead $78,660 323,000 6,400 Estimated Use of Cost Drivers per set-up 190 17,000 per inspection 100 per machine hour 5209 130 10,100 60 NZ16 60 6,900 40

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Sabby Industries has three activity cost pools and two products. It expects to produce 2,900 units of Product S209 and 1.200 of
Product NZ16. Having identified its activity cost pools and the cost drivers for each pool, Sabby accumulated the following data
relative to those activity cost pools and cost drivers.
Activity Cost Pool
Machine set-ups
Assembling
Inspection
(a)
Cost Driver
Assembling
Set-ups
Machine hours
Calculate the overhead rates.
Inspection
Inspections
Machine set-ups $
$
Estimated
Overhead
$78,660
323,000
6,400
Estimated Use
of Cost Drivers
per set-up
190
per inspection
17,000
100
per machine hour
5709 NZ16
130
10,100
60
60
6,900
40
Transcribed Image Text:Sabby Industries has three activity cost pools and two products. It expects to produce 2,900 units of Product S209 and 1.200 of Product NZ16. Having identified its activity cost pools and the cost drivers for each pool, Sabby accumulated the following data relative to those activity cost pools and cost drivers. Activity Cost Pool Machine set-ups Assembling Inspection (a) Cost Driver Assembling Set-ups Machine hours Calculate the overhead rates. Inspection Inspections Machine set-ups $ $ Estimated Overhead $78,660 323,000 6,400 Estimated Use of Cost Drivers per set-up 190 per inspection 17,000 100 per machine hour 5709 NZ16 130 10,100 60 60 6,900 40
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