Oliver Industries, a small, family-run manufacturer, has adopted an ABC system . The fol- lowing manufacturing activities, indirect manufacturing costs, and usage of cost drivers have been estimated for the year : Activity Machine setup ............................................ Machining ............ ........................... .......... .. Quality control .... ....... .......... .......... ............ Estimated Total Manufacturing Overhead Costs $ 161,650 $1,100,000 $360,000 Estimated Total Usage of Cost Driver 3,050 setups 5,000 machine hours 4,500 tests run During May, Jeff and Arabella Oliver machined and assembled Job 557 . Jeff worked a to- tal of 10 hours on the job, while Arabella worked 4 hours on the job . Jeff is paid a $25 per hour wage rate, while Arabella is paid $28 per hour because of her additional experience level. Direct materials requisitioned for Job 557 totaled $1,250 . The following additional information was collected on Job 557 : the job required 2 machine setups, 6 machine hours, and 3 quality control tests . 1. Compute the activity cost allocation rates for the year . 2. Complete the following job cost record for Job 557 :
Oliver Industries, a small, family-run manufacturer, has adopted an ABC system . The fol- lowing manufacturing activities, indirect
Activity
Machine setup ............................................ Machining ............ ........................... .......... .. Quality control .... ....... .......... .......... ............
Estimated Total Manufacturing
$ 161,650 $1,100,000 $360,000
Estimated Total Usage of Cost Driver
3,050 setups
5,000 machine hours 4,500 tests run
During May, Jeff and Arabella Oliver machined and assembled Job 557 . Jeff worked a to- tal of 10 hours on the job, while Arabella worked 4 hours on the job . Jeff is paid a $25 per hour wage rate, while Arabella is paid $28 per hour because of her additional experience level. Direct materials requisitioned for Job 557 totaled $1,250 . The following additional information was collected on Job 557 : the job required 2 machine setups, 6 machine hours, and 3 quality control tests .
1. Compute the activity cost allocation rates for the year . 2. Complete the following
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