Question: Craig Company manufactures two products-14.000 units of Bars and 6.000 units of Bells. The company currently 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:
1. Compute the cost of ONE BAR using plantwide overhead rate based on direct labor-hours to allocate Manufacturing Overhead.
2. Compute the cost of ONE BELL using plantwide overhead rate based on direct labor-hours to allocate Manufacturing Overhead.
3. Compute the cost of ONE BAR using Activity Based Costing to allocate Manufacturing Overhead.
4.Compute the cost of ONE BELL using Activity Based Costing to allocate Manufacturing Overhead.
Show transcribed image text Craig Company manufactures two produc units of Bars and 6,000 units of Bells. The company currently 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 Pool Activity Measure Estimated overhead cost Expected Activity $198,000 10,000 MHs Machining Machine-hours Machine setups Number of setups $86,400 180 setups Production design Number of products $82,000 2 products General factory Direct labor-hours $248,000 12,000 DLHs Activity Measure Bars Bells 6,800 3200 Machine-hours 130 Number of setups 50 Number of products Direct labor-hours 7,800 4,200 Bells Direct Costs Bars Direct material $250,000 $300,000 Direct labor 78,000 50,000.