Answer:
Craft Pro Machining
Activity Rate= Activity Cos/ Cost Driver
Production Activities Cost Drivers Activity Rate
Grinding $ 320,000 13,000 machine hours 24.615per machine hour
Polishing $ 135,000 13,000 machine hours 10.38 per ,machine hour
Product modification 600,000 1,500 engineering hours 400 per eng. hour
Providing power $ 255,000 17,000 direct labor hours 15 per DLH
System calibration 500,000 400 batches 1250 per batch
Working:
Job 3175 Job 4286
Number of units 200 units 2,500 units
Machine hours 550 MH 5,500 MH
Engineering hours 26 eng.hours 32 eng.hours
Batches 30 batches 90 batches
Direct labor hours 500 DLH 4,375 DLH
Job 3175 Job 4286
Number of units 200 units 2,500 units
Grinding & Polishing 19247.25 192472.5
Product modification 10400 12800
System calibration 37500 112500
<u>Providing power 7500 65625</u>
<u>Total Costs $ 74,647.25 $ 383,397.5 </u><u> </u>
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The overhead cost per unit for Job 3175 = $ 74,647.25 /200=$ 373.24
The overhead cost per unit for Job 4286= $ 383,397.5/2,500= $ 153.36
