Molly's Dog Treats is considering the use of activity-based costing. The following information is provided for the production of two product lines: Activity Total Budgeted Cost Allocation Base Setup $76,600 Number of setups Machine maintenance $34,200 Number of machine hours Total $110,800     Information Regular Treats Special Treats Total Direct labor hours 5,300 7,000 12,300 Number of setups 220 1,920 2,140 Number of machine hours 980 3,020 4,000   Molly's Dog Treats expects to produce a total of 11,100 units of Regular Treats and 29,020 of Special Treats. Find the ABC indirect manufacturing cost per unit for each product. (Round your answers to two decimal places when needed and use rounded answers for all future calculations). 1. Compute the predetermined overhead allocation rate for each activity. Activity Total estimated overhead cost / Total estimated quantity of the overhead allocation base = Predetermined Overhead Allocation Rate Setup   /   =   Machine maintenance   /   =   2. Compute the expected indirect manufacturing cost of each product. Regular Treats Predetermined Overhead Allocation rate X Actual Quantity of the Allocation Base Used = Allocated Manufacturing Overhead Cost Setup   X   =   Machine Machine maintenance   X   =           Total Manufacturing Overhead Costs           Number of products           Manufacturing overhead cost per product   Special Treats Predetermined Overhead Allocation rate X Actual Quantity of the Allocation Base Used = Allocated Manufacturing Overhead Cost Setup   X   =   Machine Machine maintenance   X   =           Total Manufacturing Overhead Costs           Number of products

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Molly's Dog Treats is considering the use of activity-based costing. The following information is provided for the production of two product lines:

Activity Total Budgeted Cost Allocation Base
Setup $76,600 Number of setups
Machine maintenance $34,200 Number of machine hours
Total $110,800  

 

Information Regular Treats Special Treats Total
Direct labor hours 5,300 7,000 12,300
Number of setups 220 1,920 2,140
Number of machine hours 980 3,020 4,000

 

Molly's Dog Treats expects to produce a total of 11,100 units of Regular Treats and 29,020 of Special Treats. Find the ABC indirect manufacturing cost per unit for each product.

(Round your answers to two decimal places when needed and use rounded answers for all future calculations).

1. Compute the predetermined overhead allocation rate for each activity.

Activity Total estimated overhead cost / Total estimated quantity of the overhead allocation base = Predetermined Overhead Allocation Rate
Setup   /   =  
Machine maintenance   /   =  


2. Compute the expected indirect manufacturing cost of each product.

Regular Treats Predetermined Overhead Allocation rate X Actual Quantity of the Allocation Base Used = Allocated Manufacturing Overhead Cost
Setup   X   =  
Machine Machine maintenance   X   =  
        Total Manufacturing Overhead Costs  
        Number of products  
        Manufacturing overhead cost per product  


Special Treats Predetermined Overhead Allocation rate X Actual Quantity of the Allocation Base Used = Allocated Manufacturing Overhead Cost
Setup   X   =  
Machine Machine maintenance   X   =  
        Total Manufacturing Overhead Costs  
        Number of products  
        Manufacturing overhead cost per product  
 
 
 
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