How much total overhead cost should be assigned to one order for 500 Pastrami sandwiches, if the order requires 4 purchase orders and 100 direct labor hours?
How much total overhead cost should be assigned to one order for 500 Pastrami sandwiches, if the order requires 4 purchase orders and 100 direct labor hours?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Note that data typically changes for each new question, even when the same company or product name is used.
Tyler's Deli sells sandwiches to grocery stores in bulk. The company identified the following information for its activity-based costing system
for the year.
Activity
Allocation Base
Estimated Overhead Cost
>
Purchasing
Number of purchase orders
$150,000
Processing
Direct labor hours
360,000
Sales
Number of sales orders
90,000
The estimated activity level for each type of sandwich and in total is as follows:
Turkey
Pastrami
Total
Number of purchase orders
10,000
15,000
25,000
Direct labor hours
30,000
70,000
100,000
Number of sales orders
1,000
4,000
5,000
How much total overhead cost should be assigned to one order for 500 Pastrami sandwiches, if the order requires 4 purchase orders and
100 direct labor hours?
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