Allocating Activity Cost Pools to Products

question 13

Essay

Allocating activity cost pools to products
Burgandy Corporation makes plastic and wooden picture frames.The company has assigned $107,000 in monthly manufacturing overhead costs to two cost pools as follows: $67,000 to power costs,and $40,000 to production set-up costs.Additional monthly data are provided below:
Power costs are allocated to products using machine hours as an activity base.Set-up costs are allocated to products based on the number of production runs each product line requires.
(a)Allocate manufacturing overhead from the activity cost pools to each product line.
(b)Compare the total per-unit cost of manufacturing plastic frames and wooden frames.
(c)On a per-unit basis,which product line appears to be most profitable?

---

Definitions:

Age Discrimination

Unfair treatment of individuals based on their age, particularly in employment practices.

Gender Stereotypes

Involve generalized views or preconceptions about attributes or characteristics, or the roles that are or should be performed by, men and women.

Decision Makers

Individuals or groups responsible for making choices and forming policies or strategies within an organization.

Masculine Characteristics

Traits traditionally associated with men, such as assertiveness, competitiveness, and physical strength, often discussed in the context of gender roles and expectations.