BADM*2030 Chapter Notes -Deutsche Luft Hansa
Document Summary
Gh inc. manufactures two products, a and b: Product a requires in direct materials per unit, and product b requires. The direct labour rate is per hour. The company has always used direct labour-hours as the base for applying manufacturing overhead cost to products. Product a is more complex to manufacture than product b, and requires the use of a special milling machine. Because of the special work required in d. , the company is considering the use of activity-based costing to apply overhead cost to products. Three activity pools have been identified and the first-stage allocations have been computed. Data concerning these activity cost pools appear below: Assume that the company continues to use direct labour-hours as the base for applying overhead cost to products: compute the predetermined overhead rate, determine the unit product cost of each product.
