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The controller for Tulsa Photographic Supply Company has established the following activity cost pools and cost drivers.
An order for boxes of film development chemicals has the following production requirements.
Compute the total overhead that should be assigned to the development-chemical order.
What is the overhead cost per box of chemicals?
Suppose Tulsa Photographic Supply Company were to use a single predetermined overhead rate based on machine hours. Compute the rate per hour.
Under the approach in requirement , how much overhead would be assigned to the developmentchemical order?
Per box of chemicals.
Explain why these two product-costing systems result in such widely differing costs. Which system do you recommend? Why?
Build a spreadsheet: Construct an Excel spreadsheet to solve requirements , , , and above. Show how the solution will change if the following data change. The overhead associated with machine setups is , and there are inspections budgeted.