Hercules Inc. manufactures elliptical exercise machines and treadmills. The products are produced in its Fabrication...
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Accounting
Hercules Inc. manufactures elliptical exercise machines and treadmills. The products are produced in its Fabrication and Assembly production departments. In addition to production activities, several other activities are required to produce the two products. These activities and their associated activity rates are as follow
Activity
Activity Rate
Fabrication
$21
per machine hour
Assembly
$13
per direct labor hour
Setup
$48
per setup
Inspecting
$20
per inspection
Production scheduling
$14
per production order
Purchasing
$11
per purchase order
The activity-base usage quantities and units produced for each product were as follows:
Activity Base
Elliptical Machines
Treadmill
Machine hours
1,978
1167
Direct labor hours
402
157
Setups
59
18
Inspections
663
398
Production orders
71
14
Purchase orders
188
115
Units produced
288
193
Use the activity rate and usage information to determine the total activity cost and activity cost per unit for each product. If required, round the per unit answers to the nearest cent.
Total Activity Cost
Activity Cost Per Unit
Elliptical Machines
$
$
Treadmill
$
$
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