Turnbull Company produces two products and their overhead consists of setups $20,000; machining $2,220,000; and packing $80,000.Data for the current year follow: Beta Delta
Number of setups 20 20
Machine hours 1,000 4,000
Packing orders 150 350
Number of
A)$256,000 and $478,000
B)$464,000 and $456,000
C)$256,000 and $242,000
D)$464,000 and $478,000

Question

Quizplus · Accepted Answer

The overhead costs are allocated based on the activity drivers: setups, machine hours, and packing orders. The total overhead is $2,320,000 ($20,000 + $2,220,000 + $80,000). Allocating these costs based on the given data results in $464,000 for Beta and $478,000 for Delta.

Turnbull Company Produces Two Products and Their Overhead Consists of Setups