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Rather Bedding Makes Two Types of Pillow-Down and Foam What Is the Overhead Cost for Each Down Pillow When

question 16

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Rather Bedding makes two types of pillow-down and foam. It is currently implementing an activity-based costing system. In the past, all overhead had been applied on the basis of machine hours. The company produces 6,000 down pillows and 18,000 foam pillows per year.
$\begin{array}{|l|c|c|c|c|}\hline\text { Cost Pool } & \begin{array}{c}\text { Driver and } \\\text { Level }\end{array} & \begin{array}{c}\text { Estimated } \\\text { Costs }\end{array} & \begin{array}{c}\text { Use of Driver by } \\\text { Down Pillows }\end{array} & \begin{array}{c}\text { Use of Driver by } \\\text { Foam Pillows }\end{array} \\\hline \text { Equiument setup } & 360 \text { setups } & \$ 216,000 & 120 \text { setups } & 240 \text { setups } \\\hline \text { Materials ordering } & 6,000 \text { orders } & \$ 60,000 & 2,400 \text { orders } & 3,600 \text { orders } \\\hline \text { Quality control }&2,000\text { inspections }&\$ 36,000 & 800 \text { inspections } & 1,200 \text { inspections }\\\hline \text { Machining }&\text { 8,000 machine hours }&\$86,000&\text { 4,200 machine hours }&\text { 3,800 machine hours }\\\hline\end{array}$
What is the overhead cost for each down pillow when all overhead is applied based on machine hours?

Definitions:

Human Resource Forecasting

The process of predicting an organization's future human resource needs, including the number, skills, and locations of employees.

Forecasting

The process of making predictions about future events or trends based on historical data and analysis.

Medium-run

A term used in economics to describe a period in which output and other economic indicators can adjust to changes.

Human Resource Forecasting Model

A strategy used in HR management to predict an organization's future labor needs and talent demands.