Question 4 (6 points)
Smartdeck, a digital device accessory maker uses activity-based costing for its
manufacturing process and has generated the following activities and information:
Activity Estimated Cost Allocation Base
Materials handling $100,000 Number of parts
Machine Setup 10,000 Number of setups
Finishing 84,000 DL Hours
Total indirect costs $194,000
Smartdeck expects to produce 1,000 accessories during the year. The accessories are
expected to use 10,000 parts, require 10 setups, and take 21,000 hours of finishing.
Blank 1: What is the Overhead rate for each activity?
Blank 2 EXTRA CREDIT (Up to 3 points) What is the total overhead per unit?