Fogerty Company makes two products, titanium Hubs and Sprockets.Data regarding the two products follow:
Direct
Labor-Hours per Unit Annual
Production Hubs 0.80 23,000 units Sprockets 0.40 54,000 units
Additional information about the company follows:
a. Hubs require $25 in direct materials per unit, and Sprocketsrequire $17.
b. The direct laborwage rate is $18 per hour. c. Hubs are morecomplex to manufacture than Sprockets and they require specialequipment. d. The ABC systemhas the following activity cost pools:
Estimated Activity Activity Cost Pool (Activity Measure) Overhead Cost Hubs Sprockets Total Machine setups (number of setups) $ 29,250 125 100 225 Special processing (machine-hours) $ 198,000 3,600 0 3,600 General factory (organization-sustaining) $ 277,600 NA NA NA 1.Compute the activity rate for each activity cost pool.
2.Determine the unit product cost of each product according to theABC system. (Round intermediate calculations and finalanswers to 2 decimal places.)
Fogerty Company makes two products, titanium Hubs and Sprockets.Data regarding the two products follow:
| Direct Labor-Hours per Unit | Annual Production | ||
| Hubs | 0.80 | 23,000 | units |
| Sprockets | 0.40 | 54,000 | units |
| Additional information about the company follows: |
| a. | Hubs require $25 in direct materials per unit, and Sprocketsrequire $17. |
| b. | The direct laborwage rate is $18 per hour. |
| c. | Hubs are morecomplex to manufacture than Sprockets and they require specialequipment. |
| d. | The ABC systemhas the following activity cost pools: |
| Estimated | Activity | ||||
| Activity Cost Pool (Activity Measure) | Overhead Cost | Hubs | Sprockets | Total | |
| Machine setups (number of setups) | $ | 29,250 | 125 | 100 | 225 |
| Special processing (machine-hours) | $ | 198,000 | 3,600 | 0 | 3,600 |
| General factory (organization-sustaining) | $ | 277,600 | NA | NA | NA |
| 1.Compute the activity rate for each activity cost pool. 2. Determine the unit product cost of each product according to theABC system. (Round intermediate calculations and finalanswers to 2 decimal places.) | |||||
Related questions
Fogerty Company makes two productsâtitanium Hubs and Sprockets. Data regarding the two products follow:
| Direct Labor-Hours per Unit | Annual Production | ||
| Hubs | 0.70 | 12,000 | units |
| Sprockets | 0.30 | 49,000 | units |
Additional information about the company follows:
Hubs require $30 in direct materials per unit, and Sprockets require $13.
The direct labor wage rate is $14 per hour.
Hubs require special equipment and are more complex to manufacture than Sprockets.
The ABC system has the following activity cost pools:
| Estimated | Activity | ||||
| Activity Cost Pool (Activity Measure) | Overhead Cost | Hubs | Sprockets | Total | |
| Machine setups (number of setups) | $ | 32,760 | 130 | 104 | 234 |
| Special processing (machine-hours) | $ | 92,500 | 3,700 | 0 | 3,700 |
| General factory (organization-sustaining) | $ | 258,300 | NA | NA | NA |
Required:
1. Determine the unit product cost of each product according to the ABC system.
