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Pomme Company uses activity-based costing to compute product costs for external reports. The company has...

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Accounting

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Pomme Company uses activity-based costing to compute product costs for external reports. The company has three activity cost pools and applies overhead using predetermined overhead rates for each activity cost pool. Estimated costs and activities for the current year are presented below for the three activity centres Estimated Activity Centre Batch Setups Material Handling General Factory Overhead Expected Costs Activity 1,200 2.400 2.600 $20.400 $52.800 $78.000 Actual costs and activities for the current year were as follows Actual Overhead Costs $20,740 $52.360 $77,590 Activity Actual Activity 1.230 2.470 2.680 Centre Batch Setups Material Handling General Factory Required a) Calculate the overhead rates per Activity Centre and how much total overhead was applied to products during the year? (6 marks) b) By how much was overhead overapplied or underapplied? (Be sure to clearly label your answer as to whether the overhead was overapplied or underapplied for each activity centre as well as for the total.)

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