Business, 30.03.2021 20:00 jrocklove7825

Snowden Industries produces two electronic decoders, P and Q. Decoder P is more sophisticated and requires more programming and testing than does Decoder Q. Because of these product differences, the company wants to use activity-based costing to allocate overhead costs. It has identified four activity pools. Relevant information follows: Activity Pools Cost Pool Total Cost Driver
Repair and maintenance on assembly machine $104,000 Number of units produced
Programming cost 168,000 Number of programming hours
Software inspections 12,000 Number of inspections
Product testing 16,000 Number of tests
Total overhead cost $300,000

Expected activity for each product follows:

Number of Units Number of Programming Hours Number of Inspections Number of Tests
Decoder P 16,000 2,000 190 1,400
Decoder Q 36,000 1,500 60 1,100
Total 52,000 3,500 250 2,500

Required
a. Compute the overhead rate for each activity pool.
b. Determine the overhead cost allocated to each product.

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Snowden Industries produces two electronic decoders, P and Q. Decoder P is more sophisticated and re...

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