Problem 5-27

1. Overhead allocation rate = $453,600 ( 10,500 machine-hours = $43.20 per machine-hour

| |Job 215 |Job 325 |

| | | |

|Overhead allocateda |$1,728 |$2,592 |

a $43.20 per machine-hour × 40 hours; 60 hours

2. Overhead allocation using an activity-based job-costing system:

| |Budgeted Overhead|Activity Driver |Budgeted Activity Driver|Activity Rate |

|Purchasing |$ 70,000 |Purchase orders processed|2,000 |$35.00 |

|Material handling |$ 87,500 |Material moves |5,000 |$17.50 |

|Machine maintenance |$ 237,300 |Machine hours |10,500 |$22.60 |

|Product inspection |$ 18,900 |Inspections |1,200 |$15.75 |

|Packaging |$ 39,900 |Units produced |3,800 |$10.50 |

| |$ 453,600 | | | |

| |Job 215 |Job 325 |

|Overhead allocated | | |

|Purchasing ($35 ( 25; 8 orders) |$ 875.00 |$ 280.00 |

|Material handling ($17.50 ( 10; 4 moves) | 175.00 | 70.00 |

|Machine maintenance ($22.60 ( 40; 60 hours)...