Question

Weirick, Inc., manufactures and sells two products: Product T8 and Product P4. The company has an activity-based costing system with the following activity cost pools, activity measures, and expected activity: Estimated Expected Activity Activity Cost Pools Activity Measures Overhead Cost Product T8 Product P4 Total Labor-related DLHs $ 117,100 4,800 2,400 7,200 Production orders orders 55,210 700 200 900 Order size MHs 863,520 2,900 3,600 6,500 $ 1,035,830 The total overhead applied to Product P4 under activity-based costing is closest to: (Round your intermediate calculations to 2 decimal places.) rev: 03_25_2018_QC_CS-119201

Answer 1

Total Overhead cost = $529,552

Step-by-step explanation:

Product P4 Expected cost Expected Activity Activity Rate

Labor-related 117,100 7,200 16.26

Production orders 55,210 900 61.34

Order size 863,520 6,500 132.85

The total overhead applied to Product P4 under activity-based costing will be derived by Total of various (Activity Rate * Activity incurred)

Product P4 Activity Rate Activity Incurred Overhead assigned

Labor-related 16.26 2,400 39024

Production orders 61.34 200 12268

Order size 132.85 3,600 478260

Total Overhead cost $529,552