Erskine Company uses activity-based costing to compute product costs for external reports. The company has three activity centers and applies overhead using predetermined overhead rates for each activity center. Estimated costs and activities for the current year are presented below for the three activity centers:
- Estimated Overhead Cost Expected Activity
- Batch setups $30,400 1,600
- Material handling 69,600 2,900
- General factory 21,700 700
Actual costs and activities for the current year were as follows:
Actual Overhead Cost Actual Activity
- Batch setups $29,480 1,600
- Material handling 69,930 2,850
- General factory 20,960 650
REQUIRED:
a. How much total overhead was applied to products during the year? Show all mathematical calculations for credit and label everything clearly.