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makes two styles of trophies, basic and deluxe, and operates at capacity.

Terrific

does large custom orders.

Terrific

budgets to produce

10,000

basic trophies and

5,000

deluxe trophies. Manufacturing takes place in two production departments: forming and assembly. In the forming department, indirect manufacturing costs are accumulated in two cost pools, setup and general overhead. In the assembly department, all indirect manufacturing costs are accumulated in one general overhead cost pool. The basic trophies are formed in batches of

200

but because of the more intricate detail of the deluxe trophies, they are formed in batches of

50.

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The controller has asked you to compare plant-wide, department, and activity-based cost allocation.

Terrific

Budgeted Information for the Year Ended

November

30,

2017

Forming Department	Basic	Deluxe	Total
Direct materials	$26,000	$23,000	$49,000
Direct manufacturing labour	32,300	7,700	40,000
Overhead costs
Setup			50,950
General overhead			22,400

Assembly Department	Basic	Deluxe	Total
Direct materials	$5,100	$23,400	$28,500
Direct manufacturing labour	15,600	20,400	36,000
Overhead costs
General overhead			64,800

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