Check my wo The following information applies to the questions displayed below.
ID: 2436098 • Letter: C
Question
Check my wo The following information applies to the questions displayed below. Hickory Company manufactures two products-15,000 units of Product Y and 7,000 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 $664,200 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: Estimated Overhead Cost Expected Activity Activity Cost Machining Machine setups Product design General factory Activity Measu Machine-hours 221,100 11,000 MHs 210 setups Number of setups 107,100 Number of products 85,000 Direct labor-hours 251,000 13,200 DLHs 2 products Activity Measure Produet YProduct Machine-hours Number of setups Number of products Direct labor-hours 8,100 5,100 7,100 60 3,900 150 3. What is the activity rate for the Machining activity cost pool? (Round your answer to 2 decimal places.) per MH Prev 3 4515 of 15 Next >Explanation / Answer
Solution 3:
Activity rate of machining actibity cost pool = Estimated cost of machining activity / Machine hours
= $221,100 / 11000 = $20.10 per machine hour