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Empire Company manufactures wheel rims. The controller expects the following ABC allocation rates for

2018?:

Predetermined Overhead

Activity

Allocation Base

Allocation Rate

Materials handling

Number of parts

$7.00

per part

Machine setup

Number of setups

700.00

per setup

Insertion of parts

Number of parts

23.00

per part

Finishing

Number of finishing hours

60.00

per hour

Empire produces two wheel rim? models: standard and deluxe. Expected data for

20182018

are as? follows:

	Standard		Deluxe
Parts per rim	2.0		4.0
Setups per 500 rims	15.0		15.0
Finishing hours per rim	2.0		4.5
Total direct labor hours per rim	4.0		5.0

The company expects to produce 500 units of each model during the year.

1.Compute the total estimated indirect manufacturing cost for 20182018.
2.	Prior to 20182018?, EmpireEmpire used a single plantwide overhead allocation rate system with direct labor hours as the allocation base. Compute the predetermined overhead allocation rate based on direct labor hours for 20182018. Use this rate to determine the estimated indirect manufacturing cost per wheel rim for each?model, to the nearest cent.
3.	Compute the estimated ABC indirect manufacturing cost per unit of each model for 20182018. Carry each cost to the nearest cent.

500

500

units of each model during the year.

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