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Hickory Company manufactures two products—13,000 units of Product Y and 5,000 units of Product Z

Accounting

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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 labour-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:

 

	Activity Measure	Estimated Overhead Cost			Expected Activity
Machining	Machine-hours	$	231,600		12,000	MH
Machine setups	Number of setups	$	55,900		130	setups
Product design	Number of products	$	77,000		2	products
General factory	Direct labour-hours	$	364,500		14,400	DLHs

 

Activity Measure	Product Y			Product Z
Machine-hours		6,300			5,700
Number of setups		40			90
Number of products		1			1
Direct labour-hours		9,000			5,400

1- What is the company's plantwide overhead rate?

2- Using the plantwide overhead rate, how much manufacturing overhead cost is allocated to Product Y and Product Z?

3-What is the activity rate for the Machining activity cost pool?

4- What is the activity rate for the Machine Setups activity cost pool?

5-What is the activity rate for the Product Design activity cost pool?

6- What is the activity rate for the General Factory activity cost pool?

7- Which of the four activities is a batch-level activity?

multiple choice

Machine setups activity

General factory activity

Product design activity

Machining activity

 

8- Which of the four activities is a product-level activity?

multiple choice

Machining activity

Product design activity

General factory activity

Machine setups activity

 

9- Using the ABC system, how much total manufacturing overhead cost would be assigned to Product Y?

10- Using the ABC system, how much total manufacturing overhead cost would be assigned to Product Z?