Question

Which of the following is not a batch-level activity! 1) Assembling 2) Inspection 3) Equipment setups 4) Purchase ordering Question 27 (2.5 points) For its inspecting cost pool, Davidson, Inc. expected overhead cost of $300,000 and 4,000 inspections. The actual overhead cost for that cost pool was $360,000 for 5,000 inspections. The activity-based overhead rate used to assign the costs of the inspecting cost pool to products is 1) $60 per inspection. 2) $72 per inspection. 3) $75 per inspection. 4) $90 per inspection.

Answer 1

Solution 1:

Assembling is not a batch level activity as it is a unit level activity.

'Hence option 1 is correct.

solution 2:

Activity based overhead rate for inspection = Expected cost / Expected activity = $300,000 / 4000 = $75 per inspection

Hence option 3 is correct.

Solution 3:

In determining total manufacturing costs on the cost of goods manufactured schedule in a job order costing system, "Manufacturing overhead applied is added to the direct materials and direct labor"

Hence last option is correct.