Compute the activity rate
Course:- Cost Accounting
Reference No.:- EM13298639

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Fogerty Company makes two products, titanium Hubs and Sprockets. Data regarding the two products follow:

per unit Annual
Hubs 0.80 21,000 units
Sprockets 0.40 86,000 units

Additional information about the company follows:
a. Hubs require $15 in direct materials per unit, and Sprockets require $12.
b. The direct labor wage rate is $17 per hour.
c. Hubs are more complex to manufacture than Sprockets and they require special equipment.
d. The ABC system has the following activity cost pools:

Estimated Overhead

Activity Activity Cost Pool Activity Measure Cost Hubs Sprockets Total
Machine setups Number of setups $ 22,000 99 79 178
Special processing Machine-hours $ 150,000 4,400 1 4,401
General factory Direct labor-hours $ 274,000 16,800 34,400 51,200

Requirement 1:
Compute the activity rate (i.e., predetermined overhead rate) for each activity cost pool. (Do not round intermediate calculation. Round your final answers to 2 decimal places. Omit the "tiny_mce_markerquot; sign in your response.)

Activity Cost Pool Activity Rate
Machine setups $ per setup
Special processing $ per MH
General factory $ per DLH

Requirement 2:
Determine the unit product cost of each product according to the ABC system. (Do not round intermediate calculation. Round your final answers to 2 decimal places. Omit the "tiny_mce_markerquot; sign in your response.)

Unit product cost of Hubs $
Unit product cost of Sprockets $

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