Hugle Corporation's activity-based costing system has three activity cost pools-Machining, Setting Up, and Other. The company's overhead costs have already been allocated to these cost pools as follows:
| Machining |
$ |
47,250 |
| Setting up |
$ |
125,354 |
| Other |
$ |
21,600 |
Costs in the Machining cost pool are assigned to products based on machine-hours (MHs) and costs in the Setting Up cost pool are assigned to products based on the number of batches. Costs in the Other cost pool are not assigned to products. The following table shows the machine-hours and number of batches associated with each of the company's two products:
| MHs |
Batches |
| Product E8 |
2,700 |
1,600 |
| Product V8 |
8,550 |
730 |
| |
| Total |
11,250 |
2,330 |
Additional data concerning the company's products appears below:
| |
Product E8 |
Product V8 |
| Sales (total) |
$ |
281,500 |
$ |
221,000 |
| Direct materials (total) |
$ |
74,500 |
$ |
83,400 |
| Direct labor (total) |
$ |
85,200 |
$ |
58,000 |
Required:
a. Calculate activity rates for each activity cost pool using activity-based costing. (Round your intermediate calculations to 2 decimal places. Omit the "$" sign in your response.)
b. Determine the amount of overhead cost that would be assigned to each product using activity-based costing. (Round your intermediate calculations to 2 decimal places. Omit the "$" sign in your response.)
c. Determine the product margins for each product using activity-based costing. (Round your intermediate calculations to 2 decimal places. Omit the "$" sign in your response.)