TRADITIONAL OVERHEAD AND ACTIVITY BASED COSTING Summarize: Two product range: the standard range and the special range.

TRADITIONAL OVERHEAD AND ACTIVITY BASED COSTING

Summarize:

Two product range: the standard range and the special range.

During July, 300 standard windows and 50 specialized windows were manufactured and

indirect production costs of $73,000 were incurred

Activity

Materials handling

Machine set-ups

Quality inspections

Cost driver

Number of requisitions

Number of set-ups

Number of inspections

Cost driver

Number of requisitions

Number of set-ups

Number of inspections

Specialized

400

150

200

Total cost

$25,000

$27,000

$21,000

Standard

600

300

400

Total

1,000

450

600

Question a: Calculate the indirect activity cost rate for each activity

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