JUNO company allocated overhead costs to its two products (Basic and Deluxe) using ABC. Juno...
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JUNO company allocated overhead costs to its two products (Basic and Deluxe) using ABC. Juno prepared the following annual estimates of each activity and cost driver. Overhead Cost Pool Cost Driver Budgeted Overhead Budgeted Activity (Cost Driver) Machine setups # setups $300,000 100 setups Machining # machine hours $700,000 35,000 machine hours Finishing # direct labor hours $1,000,000 10,000 direct labor hours Calculate the activity pool rate for each activity a) Machine setups b) Machining c) Finishing Calculate the total overhead applied using ABC a) Basic Product line b) Deluxe product line If JUNO used a traditional approach, with an overhead rate based on direct labor hours, calculate the, a) Predetermined overhead rate b) Overhead applied to the basic line
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