Hickory Company manufactures two products-14,000 units of Product Y and 6,000 units of Product Z....
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Hickory Company manufactures two products-14,000 units of Product Y and 6,000 units of Product Z. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates all $684,000 of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products Y and Z: 3 Activity Cost Pool Machining Machine setups Product design General factory Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Estimated Overhead Cost $ 200,000 $ 100,000 $ 84,000 $ 300,000 Expected Activity 10,000 MHS 200 setups 2 products 12,000 DLHS Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Product Y Product z 7,000 3,000 50 150 1 1 8,000 4,000 5. What is the activity rate for the Product Design activity cost pool? Activity rate per product
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