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Greenwood Company manufactures two products—14,000 units of Product Y and 6,000 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 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 PoolActivity MeasureEstimated Overhead CostExpected

ActivityMachiningMachine-hours$209,000


10,000MHsMachine setupsNumber of setups$171,100


290setupsProduction designNumber of products$93,000


2productsGeneral factoryDirect labor-hours$259,000


10,000DLHs


Activity MeasureProduct YProduct ZMachining

8,900


1,100

Number of setups

50


240

Number of products

1


1

Direct labor-hours

8,900


1,100


What is the activity rate for the Product Design activity cost pool?

What is the activity rate for the General Factory activity cost pool? 

Using the ABC system, how much total manufacturing overhead cost would be assigned to Product Y? 

Using the ABC system, how much total manufacturing overhead cost would be assigned to Product Z? 

Using the plantwide overhead rate, what percentage of the total overhead cost is allocated to Product Y and Product Z? 

Using the ABC system, what percentage of the Machining costs is assigned to Product Y and Product Z? 

Using the ABC system, what percentage of Machine Setups cost is assigned to Product Y and Product Z?

Using the ABC system, what percentage of the Product Design cost is assigned to Product Y and Product Z?

Using the ABC system, what percentage of the General Factory cost is assigned to Product Y and Product Z? 

Top Answer

Answer 1) Activity rate for the Product Design activity cost pool = 46500 per Product 2) Activity rate for the General... View the full answer

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