221_Solutions_Chap_7_Fa_05

221_Solutions_Chap_7_Fa_05 - E7-28 a Overhead rate per...

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E7 - 28 a . Overhead rate per direct labor dollar: $82,200 ÷ $45,000 = 1.827 or 182.7% Gas Charcoal Cooker Smoker Direct materials $40,000 $100,000 Direct labor 20,000 25,000 Overhead (182.7% direct labor) 36,540 45,675 Total cost $96,540 $170,675 Units ÷ 1,000 ÷ 5,000 Unit cost $ 96.54 $ 34.135 b . Rate per unit of cost driver: Activity Cost Cost driver Rate Materials acquisition and inspection $30,000 $140,000 0.214/DM$ Materials movement 16,200 100 $162/move Scheduling 36,000 60 $600/batch Gas Charcoal Cooker Smoker Total direct materials costs $ 40,000 $ 100,000 Total direct labor costs 20,000 25,000 Overhead costs: Materials acquisition $40,000 & $100,000 @ 0.214/DM$ 8,560 21,400 Materials movement 80 & 20 @ $162/batch move 12,960 3,240 Scheduling 50 & 10 @ $600/batch 30,000 6,000 Total costs $111,520 $155,640
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