Flash Company budgeted $558,000 manufacturing direct wages, 2,000 direct labor hours, and had the following manufacturing overhead:
Overhead Cost Pool
Materials handling
Machine setup
Machine repair
Inspections
Budgeted
Overhead Cost
$ 140,000
14,700
1,500
11,400
Budgeted Level for
Cost Driver
3,500 pounds
420 setups
30,000 machine hours
190 inspections
Requirements for Job number 971 which manufactured 4 units of product:
Direct labor
Direct materials
Machine setup
Machine hours
Inspections
20 hours
160 pounds
40 setups
15,300 machine hours
15 inspections
Using activity-based costing, the materials handling overhead cost assigned to Job number 971 is:
Multiple Choice
$2,650.
$900.
$6,400.
$765.
$1,400.
Overhead Cost Driver
Weight of materials
Number of setups
Machine hours
Number of inspections