Deemer Corporation has an activity-based costing system with three activity cost pools--Processing, Supervising, and Other. In the first stage allocations, costs in the two overhead accounts, equipment expense and indirect labor, are allocated to the three activity cost pools based on resource consumption. Data used in the first stage allocations follow: Overhead costs: Equipment expense Indirect labor $ 123,000 $ 7,100 Distribution of Resource Consumption Across Activity Cost Pools: Equipment expense Indirect labor Product F6 Product X0 Total Activity Cost Pools Supervising 0.40 0.30 MHS (Processing) 17,400 1,330 18,730 Processing 0.50 0.50 Processing costs are assigned to products using machine-hours (MHS) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow: Activity: Other 0.10 0.20 Batches (Supervising) 710 1,330 2,040 The activity rate for the Supervising activity cost pool under activity-based costing is closest to:
Deemer Corporation has an activity-based costing system with three activity cost pools--Processing, Supervising, and Other. In the first stage allocations, costs in the two overhead accounts, equipment expense and indirect labor, are allocated to the three activity cost pools based on resource consumption. Data used in the first stage allocations follow: Overhead costs: Equipment expense Indirect labor $ 123,000 $ 7,100 Distribution of Resource Consumption Across Activity Cost Pools: Equipment expense Indirect labor Product F6 Product X0 Total Activity Cost Pools Supervising 0.40 0.30 MHS (Processing) 17,400 1,330 18,730 Processing 0.50 0.50 Processing costs are assigned to products using machine-hours (MHS) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow: Activity: Other 0.10 0.20 Batches (Supervising) 710 1,330 2,040 The activity rate for the Supervising activity cost pool under activity-based costing is closest to:
Chapter6: Activity-based, Variable, And Absorption Costing
Section: Chapter Questions
Problem 10MC: What is the proper order of tasks In an ABC system? identify the cost drivers, assign the costs to...
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