4 Doede Corporation Uses Activity Based Costing To Compute Product Margins In The First Stage The Activity Based Costi 1 (48 KiB) Viewed 21 times
4 Doede Corporation uses activity-based costing to compute product margins. In the first stage, the activity-based costing system allocates two overhead accounts--equipment depreciation and supervisory expense--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 Supervisory expense $ 92,000 $ 4,000 Distribution of Resource Consumption Across Activity Cost Pools: Activity Cost Pools Equipment depreciation Supervisory expense Machining Order Filling 0.20 0.60 0.30 0.20 Product W1 Product M0 Total In the second stage, Machining costs are assigned to products using machine-hours (MHS) and Order Filling costs are assigned to products using the number of orders. The costs in the Other activity cost pool are not assigned to products. Activity: MHS (Machining) 4,200 15,800 20,000 Other 0.20 0.50 Orders (Order Filling) 800 200 1,000 Finally, sales and direct cost data are combined with Machining and Order Filling costs to determine product margins. Sales and Direct Cost Data: Product W1 Product M $ 236,500 $ 262,000 Sales (total) Direct materials (total) $ 90,900 $ 123,900 $76,100 Direct labor (total) $ 110,400 What is the overhead cost assigned to Product W1 under activity-based costing?
What is the overhead cost assigned to Product W1 under activity-based costing? Multiple Choice $15,360 $48,000 $27,204 $11,844
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