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Sultan Company uses an activity-based costing system. At the beginning of the year, the company...

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Accounting

Sultan Company uses an activity-based costing system. At the beginning of the year, the company made the following estimates of cost and activity for its five activity cost pools:

Activity Cost Pool Activity Measure Expected Overhead Cost Expected Activity
Labor-related Direct labor-hours $ 233,600 29,200 DLHs
Purchase orders Number of orders $ 9,360 234 orders
Parts management Number of part types $ 80,000 100 part types
Board etching Number of boards $ 59,850 1,710 boards
General factory Machine-hours $ 236,500 21,500 MHs

Required:

1. Compute the activity rate for each of the activity cost pools.

2. The expected activity for the year was distributed among the companys four products as follows:

Activity Cost Pool Expected Activity
Product A Product B Product C Product D
Labor-related (DLHs) 4,400 16,100 3,300 5,400
Purchase orders (orders) 74 29 50 81
Parts management (part types) 25 18 44 13
Board etching (boards) 430 750 530 0
General factory (MHs) 3,300 8,100 3,600 6,500

Using the ABC data, determine the total amount of overhead cost assigned to each product.

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