Coronado Machining makes three products. The companys annual budget includes $1,222,500 of overhead. In the...
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Coronado Machining makes three products. The companys annual budget includes $1,222,500 of overhead. In the past, the company allocated overhead based on expected capacity of 40,750 direct labor hours. The company recently implemented an activity-based costing system and has determined that overhead costs can be broken into four overhead pools: order processing, setups, milling, and shipping. The following is a summary of company information:
Expected Cost
Expected Activities
Order processing
$
333,000
18,000
orders
Setups
200,900
4,900
setups
Milling
438,600
20,400
machine hours
Shipping
250,000
25,000
shipments
$
1,222,500
(a)
Calculate the companys traditional overhead rate based on direct labor hours.
(b)
Calculate the companys overhead rates for each of the activity-based costing pools. (Round answers to 2 decimal places, e.g. 15.25.)
Order processing
$enter a dollar amount per order rounded to 2 decimal places
per order
Setups
$enter a dollar amount per setup rounded to 2 decimal places
per setup
Milling
$enter a dollar amount per machine hour rounded to 2 decimal places
per machine hour
Shipping
$enter a dollar amount per shipment rounded to 2 decimal places
per shipment
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