Question
In: Accounting
2. A Plus Company uses activity-based costing to determine the costs of its three products: A,...
2.
A Plus Company uses activity-based costing to determine the
costs of its three products: A, B, and C. The budgeted cost and
activity for each of the company's three activity cost pools are
shown in the following table:
| Budgeted Activity | |||||||||
| Activity Cost Pool | Budgeted Cost | Product A | Product B | Product C | |||||
| Activity 1 | $ | 70,000 | 6,000 | 9,000 | 20,000 | ||||
| Activity 2 | $ | 45,000 | 7,000 | 15,000 | 8,000 | ||||
| Activity 3 | $ | 82,000 | 2,500 | 1,000 | 1,625 | ||||
Which of the following statements is true regarding this company's
activity rates?
Multiple Choice
-
The activity rate under the activity-based costing system for Activity 2 is $2.81.
-
The activity rate under the activity-based costing system for Activity 2 is $16.00.
-
The activity rate under the activity-based costing system for Activity 2 is $19.50.
-
The activity rate under the activity-based costing system for Activity 2 is $1.50.
-
The activity rate under the activity-based costing system for Activity 2 is $2.00.
Solutions
Expert Solution
Correct answer-------The activity rate under the activity-based costing system for Activity 2 is $1.50.
Working
| Calculation of Activity rates | |||||
| Activity Cost Pool | Activity driver | Overhead Cost | Expected Activity (B) | Activity rate (A/B) | |
| Activity 1 | Number of Activity | $ 70,000.00 | 35,000 | $ 2.00 | Per Activity |
| Activity 2 | Number of Activity | $ 45,000.00 | 30000 | $ 1.50 | Per Activity |
| Activity 3 | Number of Activity | $ 82,000.00 | 5125 | $ 16.00 | Per Activity |
As it can be seen $16 per activity is rate for Activity 3 not 2 and $ 2 is rate for activity 1.
ekkarill92 answered 8 months agoRelated Solutions
A company uses activity-based costing to determine the costs of its three products: A, B, and...
A company uses activity-based costing to determine the costs of
its three products: A, B, and C. The budgeted cost and activity for
each of the company's three activity cost pools are shown in the
following table:
Budgeted Activity
Activity Cost Pool
Budgeted Cost
Product A
Product B
Product C
Activity 1
$
85,000
7,500
10,500
21,500
Activity 2
$
60,000
8,500
16,500
9,500
Activity 3
$
112,000
4,000
2,500
3,125
How much overhead will be assigned to Product B...
A company uses activity-based costing to determine the costs of its three products: A, B, and...
A company uses activity-based costing to determine the costs of
its three products: A, B, and C. The budgeted cost and activity for
each of the company's three activity cost pools are shown in the
following table:
A company uses activity-based costing to determine the costs of
its three products: A, B, and C. The budgeted cost and activity for
each of the company's three activity cost pools are shown in the
following table:
Budgeted Activity
Activity Cost
Pool
Budgeted...
A company uses activity-based costing to determine the costs of its three products: A, B, and...
A company uses activity-based costing to determine the costs of
its three products: A, B, and C. The budgeted cost and activity for
each of the company's three activity cost pools are shown in the
following table:
Budgeted Activity
Activity Cost Pool
Budgeted Cost
Product A
Product B
Product C
Activity 1
$
75,000
6,500
9,500
20,500
Activity 2
$
50,000
7,500
15,500
8,500
Activity 3
$
92,000
3,000
1,500
2,125
How much overhead will be assigned to Product B...
1.) A company uses activity-based costing to determine the costs of its three products: A, B,...
1.) A company uses activity-based costing to determine the costs
of its three products: A, B, and C. The budgeted cost and activity
for each of the company's three activity cost pools are shown in
the following table:
Budgeted Activity
Activity Cost Pool
Budgeted Cost
Product A
Product B
Product C
Activity 1
$
81,000
7,100
10,100
21,100
Activity 2
$
56,000
8,100
16,100
9,100
Activity 3
$
104,000
3,600
2,100
2,725
How much overhead will be assigned to Product...
(LO 3) A company uses activity-based costing to determine the costs of its three products: A,...
(LO 3) A company uses activity-based costing to determine the
costs of its three products: A, B, and C. The budgeted cost and
activity for each of the company's three activity cost pools are
shown in the following table:
Budgeted Activity
Activity Cost Pool
Budgeted Cost
Product A
Product B
Product C
Activity 1
$
89,000
7,900
10,900
21,900
Activity 2
$
64,000
8,900
16,900
9,900
Activity 3
$
120,000
4,400
2,900
3,525
How much overhead will be assigned to...
4. Nationals Inc. uses activity-based costing to determine the costs of its three products: A, B,...
4. Nationals Inc. uses activity-based costing to determine the
costs of its three products: A, B, and C. The budgeted cost and
activity for each of the company's three activity cost pools are
shown below. (Check: Activity 1 activity rate should be a number
between $7 and $10). (3 points)
Budgeted Activity
Activity Cost Pool
Budgeted Cost
Product A
Product B
Product C
Activity 1
$140,000
7,500
4,000
6,000
Activity 2
$54,000
2,500
2,000
1,500
Activity 3
$38,000
15,000
25,000...
Job Costs Using Activity-Based Costing Heitger Company is a job-order costing firm that uses activity-based costing...
Job Costs Using Activity-Based Costing
Heitger Company is a job-order costing firm that uses
activity-based costing to apply overhead to jobs. Heitger
identified three overhead activities and related drivers. Budgeted
information for the year is as follows:
Activity
Cost
Driver
Amount of Driver
Materials handling
$101,200
Number of moves
4,000
Engineering
142,400
Number of change orders
8,000
Other overhead
358,800
Direct labor hours
52,000
Heitger worked on four jobs in July. Data are as follows:
Job 13-43
Job 13-44
Job...
Job Costs Using Activity-Based Costing Heitger Company is a job-order costing firm that uses activity-based costing...
Job Costs Using Activity-Based Costing
Heitger Company is a job-order costing firm that uses
activity-based costing to apply overhead to jobs. Heitger
identified three overhead activities and related drivers. Budgeted
information for the year is as follows:
Activity
Cost
Driver
Amount of Driver
Materials handling
$54,250
Number of moves
2,500
Engineering
120,700
Number of change orders
8,500
Other overhead
148,500
Direct labor hours
45,000
Heitger worked on four jobs in July. Data are as follows:
Job 13-43
Job 13-44
Job...
Job Costs Using Activity-Based Costing Heitger Company is a job-order costing firm that uses activity-based costing...
Job Costs Using Activity-Based Costing Heitger Company is a
job-order costing firm that uses activity-based costing to apply
overhead to jobs. Heitger identified three overhead activities and
related drivers. Budgeted information for the year is as follows:
Activity Cost Driver Amount of Driver Materials handling $108,000
Number of moves 4,500 Engineering 165,000 Number of change orders
10,000 Other overhead 263,200 Direct labor hours 47,000 Heitger
worked on four jobs in July. Data are as follows: Job 13-43 Job
13-44 Job...
Lysiak Corporation uses an activity based costing system to assign overhead costs to products. In the...
Lysiak Corporation uses an activity based costing system to
assign overhead costs to products. In the first stage, two overhead
costs--equipment depreciation and supervisory expense-are allocated
to three activity cost pools--Machining, Order Filling, and
Other--based on resource consumption. Data to perform these
allocations appear below:
Overhead costs:
Equipment depreciation
$
47,000
Supervisory expense
$
6,000
Distribution of Resource Consumption Across Activity Cost
Pools:
Activity Cost Pools
Machining
Order Filling
Other
Equipment depreciation
0.60
0.10
0.30
Supervisory expense
0.60
0.20
0.20...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- "Ethical Considerations" Please respond to the following: Reflect upon the responsibilities placed on auditors by the...
- A Japanese company has a bond outstanding that sells for 93 percent of its ¥100,000 par...
- What is the difference among the principles of modularization, abstraction, encapsulation, and separation of interface and...
- An investment project costs $20,100 and has annual cash flows of $4,400 for six years. ...
- PUT IN JAVA PROGRAMMING The StockB class: Design a class named StockB that contains the following...
- Draw a DFA for the following ( ∑ = {0,1}): Set of all strings with.
- In the article from Forbes notes that the goal of a leader is not to clone...
ADVERTISEMENT