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TRADITIONAL OVERHEAD AND ACTIVITY BASED COSTING
Summarize:
Two product range: the standard range and the special range.
During July, 300 standard windows and 50 specialized windows were manufactured and
indirect production costs of $73,000 were incurred
Activity
Materials handling
Machine set-ups
Quality inspections
Cost driver
Number of requisitions
Number of set-ups
Number of inspections
Cost driver
Number of requisitions
Number of set-ups
Number of inspections
Specialized
400
150
200
Total cost
$25,000
$27,000
$21,000
Standard
600
300
400
Total
1,000
450
600
Question a: Calculate the indirect activity cost rate for each activity
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