Question

Required information The Foundational 15 [LO7-1, LO7-3, L07-4] [The following information applies to the questions displayed below.] Hickory Company manufactures two products—15,000 units of Product Y and 7,000 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 $765,000 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: Activity Cost Pool Machining Machine setups Product design General factory Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Estimated Overhead Cost $ 231,000 $ 180,000 $ 94,000 $ 260,000 Expected Activity 11,000 MHS 300 setups 2 products 13,200 DLHS Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Product Y Product Z 8,000 3,000 60 240 1 1 7,000 6,200

Answer 1

Answer 6

- Activity rate for General factory Activity lost pool Cost driver Rate = Total Cost of the Activity Activity Cost Driver General factory a Estimated Overhead Cost Activity reath Expected Activity 13, 200 Activity = $2,60,000 Activity reate = 119° 6 per DLHI In the

Answer7,8

t. In this question the Batch level activity is Machine Set ups because these are done when the particu operatech as group is Resetting of Maelline is veequired in every Batch of Uproduction. group is wallct level activities are those vehich u done to Assis Product Protein bagetres for Exanible - preparation of Preto design is required to assist t the Making of the the producto. In this question option second prodiect design Activity is correct