Atlas Enterprises Inc. manufactures elliptical exercise machines and treadmills. The products are produced in its Fabrication and Assembly production departments. In addition to production activities, several other activities are required to produce the two products. These activities and their associated activity rates are as follows:ActivityActivity RateFabrication$27per machine hourAssembly$11per direct labor hourSetup$51per setupInspecting$29per inspectionProduction scheduling$12per production orderPurchasing$9per purchase orderThe activity-base usage quantities and units produced for each product were as follows:Activity BaseElliptical MachinesTreadmillMachine hours1,813 1,070 Direct labor hours474 185 Setups58 18 Inspections682 409 Production orders68 14 Purchase orders193 118 Units produced286 192 Use the activity rate and usage information to calculate the total activity cost and activity cost per unit for each product. If required, round the per unit answers to the nearest cent. Total Activity CostActivity Cost Per UnitElliptical Machines$$Treadmill$$

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Answered: Use the activity rate and usage…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Atlas Enterprises Inc. manufactures elliptical exercise machines and treadmills. The products are produced in its Fabrication and Assembly production departments. In addition to production activities, several other activities are required to produce the two products. These activities and their associated activity rates are as follows:

Activity	Activity Rate
Fabrication	$27	per machine hour
Assembly	$11	per direct labor hour
Setup	$51	per setup
Inspecting	$29	per inspection
Production scheduling	$12	per production order
Purchasing	$9	per purchase order

The activity-base usage quantities and units produced for each product were as follows:

Activity Base	Elliptical Machines	Treadmill
Machine hours	1,813		1,070
Direct labor hours	474		185
Setups	58		18
Inspections	682		409
Production orders	68		14
Purchase orders	193		118
Units produced	286		192

Use the activity rate and usage information to calculate the total activity cost and activity cost per unit for each product. If required, round the per unit answers to the nearest cent.

	Total Activity Cost	Activity Cost Per Unit
Elliptical Machines	$	$
Treadmill	$	$

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