Answer Happy

J&R Associates, Inc. manufacturers and sells autobody parts.
The Company has two main, but
differently made, products – engines and transmissions. The Company
expects to make 1,000
engines and 500 transmissions in 2021. Overhead costs for the
engines are expected to be $10,000,
while the overhead costs of the transmissions are expected to be
$1,000.
a) Calculate the Overhead Application Rate if J&R
Associates, Inc. were to use a single
application rate.
b) Calculate the Overhead Application Rates if J&R
Associates, Inc. were to use an
activity-based costing method. (Be sure to identify which rate is
for engines and which is for
transmissions).
c) Which do you think is a better costing method for
J&R Associates, Inc. – Single
Application Rate or Activity-Based Costing? Why?