Randy Company produces candy sticks (hooked and straight). Both products pass through two producing departments. The hooked sticks's production is much more labor-intensive than the straight sticks. The straight stick is also more popular. The following data have been gathered for the two products:
Randy has decided to use activity-based costing and has developed two types of activities, machine related (based on machine hours), and other overhead (based on packing orders). Machine-related costs equal $160,000. Other overhead costs equal $240,000.

Question

Randy Company produces candy sticks (hooked and straight). Both products pass through two producing departments. The hooked sticks's production is much more labor-intensive than the straight sticks. The straight stick is also more popular. The following data have been gathered for the two products:
 Randy has decided to use activity-based costing and has developed two types of activities, machine related (based on machine hours), and other overhead (based on packing orders). Machine-related costs equal $160,000. Other overhead costs equal $240,000.

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The Answer of Randy Company produces candy sticks (hooked and straight). Both products pass through two producing departments. The hooked sticks's production is much more labor-intensive than the straight sticks. The straight stick is also more popular. The following data have been gathered for the two products:
 Randy has decided to use activity-based costing and has developed two types of activities, machine related (based on machine hours), and other overhead (based on packing orders). Machine-related costs equal $160,000. Other overhead costs equal $240,000.

Randy Company Produces Candy Sticks (Hooked and Straight)