Hane Corporation uses the following activity rates from its activity-based costing to assign overhead costs to products: Data for one of the company's products follow:
How much overhead cost would be assigned to Product U94W using the activity-based costing system?

A) $42,176.55
B) $83.85
C) $7,784.21
D) $2,666.92

Question

Hane Corporation uses the following activity rates from its activity-based costing to assign overhead costs to products:

Data for one of the company's products follow:
Hane Corporation uses the following activity rates from its activity-based costing to assign overhead costs to products: Data for one of the company's products follow: How much overhead cost would be assigned to Product U94W using the activity-based costing system? A) $42,176.55 B) $83.85 C) $7,784.21 D) $2,666.92

How much overhead cost would be assigned to Product U94W using the activity-based costing system?

A) $42,176.55
B) $83.85
C) $7,784.21
D) $2,666.92

Zybrea Knight · Accepted Answer

Final Answer : C, Explanation :  To calculate the overhead cost assigned to Product U94W, we need to multiply the activity rate of each activity by the corresponding amount of activity used by U94W, then add up the results.Activity 1: $0.35 x 34,500 = $12,075Activity 2: $2.25 x 1,500 = $3,375Activity 3: $0.25 x 30,000 = $7,500Activity 4: $13 x 45 = $585Total overhead cost assigned to U94W = $23,535Therefore Choice C is the correct answer.

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