Musical Instruments Company manufactures two products (trumpets and trombones). Overhead costs ($175,000) have been divided into three cost pools that use the following activity drivers.
|
Product |
Number of setups |
Machine hours |
Packing orders |
|
|
Trumpets |
50 |
1,500 |
150 |
|
|
Trombones |
50 |
4,500 |
250 |
|
|
Cost per pool |
$60,000 |
$90,000 |
$25,000 |
|
|
|
|
|
|
|
Required (show all calculations):
a. What is the allocation rate for trumpets per setup using activity-based costing?
b. What is the allocation rate for trumpets per machine hours using activity-based costing?
c. What is the allocation rate for trumpets per packing order using activity-based costing?