Tires Unlimited Corp

Essay

Tires Unlimited Corp. produces two types of tires, regular and snow tires. The company uses activity-based costing and has identified two activities and their budgeted costs:
Molding is based on mixing hours and assembly is based on machine hours. Information regarding each product is as follows:
Required:
A. Calculate the activity rate for molding and assembly. Round your answer to two decimal places.
B. Calculate how much total overhead is assigned to each type of tire.
C. Calculate the unit overhead assigned to each type of tire.
D. Assume the company does not use ABC costing. Calculate the plantwide overhead rate, based on machine hours. Round your answer to two decimal places.
E. Calculate the total overhead assigned to each type of tire using the plantwide overhead rate.