Alliance Company manufactures two products (brushes and combs). The overhead costs have been divided into four cost pools that use the following activity drivers.
|
# of Setups |
# of Orders |
Machine Hours |
Packing Orders |
|
|
Brushes |
30 |
35 |
2,000 |
100 |
|
Combs |
10 |
65 |
6,000 |
150 |
|
Cost per Pool |
$20,000 |
$10,000 |
$280,000 |
$60,000 |
Required
- Compute the allocation rates for each of the activity drivers listed.
- Allocate the overhead costs to Products S and T using activity-based costing.
- Compute the overhead rate using machine hours under the functional-based costing system.
- Allocate the overhead costs to Products S and T using the functional-based costing system overhead rate calculated in part (c).