Question

Weisman, Inc. uses activity-based costing as the basis for information to set prices for its six lines of seasonal coats.Activity Cost PoolsEstimatedOverheadExpected Use ofCost Drivers per ActivityDesigning $427,300 11,400 designer hoursSizing and cutting 4,146,000 160,000 machine hoursStitching and trimming 1,459,000 81,300 labor hoursWrapping and packing 323,400 30,300 finished unitsCompute the activity-based overhead rates using the following budgeted data for each of the activity cost pools. (Round answers to 2 decimal places, e.g. $12.25.)Activity-based overhead ratesDesigning $Weisman, Inc. uses activity-based costing as the bper designer hourSizing and cutting $Weisman, Inc. uses activity-based costing as the bper machine hourStitching and trimming $Weisman, Inc. uses activity-based costing as the bper labor hourWrapping and packing $Weisman, Inc. uses activity-based costing as the bper finished unit

Answer 1

$37.48 per designer hours

$25.91 per machine hours

$17.95 per labor hours

Step-by-step explanation:

Activity cost pool : DESIGNING

EstimatedOverhead(X) :$427, 300

Expected Use ofCost Drivers per ACTIVITY (Y) : 11400

Rate (X ÷ Y) = $37.48 per designer hours

Activity cost pool : SIZING & CUTTING

EstimatedOverhead(X) :$4,146,000

Expected Use ofCost Drivers per ACTIVITY (Y) : 160,000

Rate (X ÷ Y) = $25.91 per machine hours

Activity cost pool : STITCHING&TRIMMING

EstimatedOverhead(X) :$1,459,000

Expected Use ofCost Drivers per ACTIVITY (Y) : 81300

Rate (X ÷ Y) = $17.95 per labor hours

Activity cost pool : WRAPPING&PACKING

EstimatedOverhead(X) :$323,400

Expected Use ofCost Drivers per ACTIVITY (Y) : 30,300

Rate (X ÷ Y) = $10.67 per finished unit