Primary Co. makes two products, benches, and chairs. Several activities are required to produce each product. Activity Activity Rate Fabrication $30 per machine hour Assembly $35 per direct labor hour Inspection $20 per inspection A. Production of benches required 600 machine hours, 190 direct labor hours, and 15 inspections. Calculate the total cost to be allocated to the production of benches. B. Production of chairs required 400 machine hours, 223 direct labor hours, and 25 inspections. Calculate the total cost to be allocated to the production of chairs.
Primary Co. makes two products, benches, and chairs. Several activities are required to produce each product. Activity Activity Rate Fabrication $30 per machine hour Assembly $35 per direct labor hour Inspection $20 per inspection A. Production of benches required 600 machine hours, 190 direct labor hours, and 15 inspections. Calculate the total cost to be allocated to the production of benches. B. Production of chairs required 400 machine hours, 223 direct labor hours, and 25 inspections. Calculate the total cost to be allocated to the production of chairs.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Primary Co. makes two products, benches, and chairs. Several activities are required to produce each product.
| Activity | Activity Rate |
| Fabrication | $30 per machine hour |
| Assembly | $35 per direct labor hour |
| Inspection | $20 per inspection |
A. Production of benches required 600 machine hours, 190 direct labor hours, and 15 inspections. Calculate the total cost to be allocated to the production of benches.
B. Production of chairs required 400 machine hours, 223 direct labor hours, and 25 inspections. Calculate the total cost to be allocated to the production of chairs.
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