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### 8 Chapter 08 - 2008.4

Course: ACC 202, Winter 2008
School: N. Central IL
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8-18 Exercise 1. First-stage allocations of overhead costs to the activity cost pools: Distribution of Resource Consumption Across Activity Cost Pools Direct Labor Order Customer Support Processing Support Other Wages and salaries ......... 30% 35% 25% 10% Other overhead costs ...... 25% 15% 20% 40% Direct Labor Order Customer Support Processing Support Wages and salaries ......... \$105,000 \$122,500 \$ 87,500...

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8-18 Exercise 1. First-stage allocations of overhead costs to the activity cost pools: Distribution of Resource Consumption Across Activity Cost Pools Direct Labor Order Customer Support Processing Support Other Wages and salaries ......... 30% 35% 25% 10% Other overhead costs ...... 25% 15% 20% 40% Direct Labor Order Customer Support Processing Support Wages and salaries ......... \$105,000 \$122,500 \$ 87,500 Other overhead costs ...... 50,000 30,000 40,000 Total cost....................... \$155,000 \$152,500 \$127,500 Example: of 30% \$350,000 is \$105,000. 2. Computation of activity rates: Totals 100% 100% Other Totals \$ 35,000 \$350,000 80,000 200,000 \$115,000 \$550,000 (a) (b) (a) (b) Activity Cost Pools Total Cost Total Activity Activity Rate Direct labor support ........ \$155,000 10,000 DLHs \$15.50 per DLH Order processing ............ \$152,500 500 orders \$305 per order Customer support ........... \$127,500 100 customers \$1,275 per customer The McGraw-Hill Companies, Inc., 2008. All rights reserved. 6 Managerial Accounting, 12th Edition
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