Question Content Area Sidon Company produces purses: deluxe and regular. Both products pass through two...
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Sidon Company produces purses: deluxe and regular. Both products pass through two producing departments. Production of deluxe purses is much more labor-intensive than the regular. Regular purses are also more popular. The following data have been gathered for the two products:
Product Data
Deluxe
Regular
Units produced per year
400,000
4,000,000
Machine hours
20,000
80,000
Packing orders
60,000
60,000
Sidon has decided to use activity-based costing and has developed two types of activities, machine related (based on machine hours) and other overhead (based on packing orders). Machine-related costs equal $320,000. Other overhead costs equal $480,000.
Required:
If required, round your answers to three decimal places. When required, use rounded amounts in subsequent computations.
Complete the following:
A. The activity rate for machine-related costs is $fill in the blank 1 per machine hour.
B. The activity rate for other overhead costs is $fill in the blank 2 per packing order.
C. Using the two activity rates, the overhead cost per unit for deluxe purses is $fill in the blank 3.
D. Using two activity rates the overhead cost per unit for regular purses is $fill in the blank 4.
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