Newman Industries manufactures a variety of custom products. The company has Exp

Question

Newman Industries manufactures a variety of custom products. The company has Expec traditionally used a plantwide manufacturing overhead rate based on machine year a hours to allocate manufacturing overhead to its products. The company estimatesE( that it will incur $1,440,000 in total manufacturing overhead costs in the upcoming year and will use 12,000 machine hours. More Info Up to this point, hazardous waste disposal fees have been absorbed into the plantwide manufacturing overhead rate and allocated to all products as part of the manufacturing overhead process. Recently, the company has been experiencing significantly increased waste disposal fees for hazardous waste generated by certain products, and as a result, profit margins on all products have been negatively impacted. Company management wants to implement an activity-based costing system so that managers know the cost of each product, including its hazardous waste disposal costs. te t Print Done

Explanation / Answer

Requirement 1

Formula: Manufacturing Overhead / Total Machine Hours

= $ 1,440,000 / 12,000 = $ 120

Cost of Order

Requirement 2

Calculation of Overhead

Total Overhead = 70x90 + 20x6 + 290x30 = $ 16200

Calculation of Cost

I cant answer Requirement 3 because dont know what are the option in the drop down given know. I hope this is helpful to you. Appreciate the efforts put in to answer by giving it a like. Thanks

Direct Material $ 11250 Direct Labour $ 1500 Overhead $ 7200 Total Cost $ 19950

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