Asked by Nicholas Coombs on May 31, 2024
Verified
The activity rate for the General Factory activity cost pool under activity-based costing is closest to:
A) $36.23 per MH
B) $68.48 per MH
C) $96.19 per MH
D) $33.59 per MH
General Factory
refers to the overall operations and activities that take place within a manufacturing facility, including production, maintenance, and storage.
Activity Rate
This is the frequency or intensity with which a specific process or activity is conducted within a given time frame.
Activity-Based Costing
A costing methodology that assigns overhead and indirect costs to specific activities, enhancing the accuracy of product costing.
- Master the essential principles and deployment of activity-based costing (ABC).
- Familiarize oneself with the process of overhead cost allocation through different activity drivers.
Verified Answer
AP
Alyssa PierceMay 31, 2024
Final Answer :
D
Explanation :
Activity rate = Estimated overhead cost ÷ Total expected activity
= $295,592 ÷ 8,800 MHs = $33.59 per MH
Reference: CH04-Ref4
Weirick, Inc., manufactures and sells two products: Product T8 and Product P4.The company has an activity-based costing system with the following activity cost pools, activity measures, and expected activity:
= $295,592 ÷ 8,800 MHs = $33.59 per MH
Reference: CH04-Ref4
Weirick, Inc., manufactures and sells two products: Product T8 and Product P4.The company has an activity-based costing system with the following activity cost pools, activity measures, and expected activity:
Learning Objectives
- Master the essential principles and deployment of activity-based costing (ABC).
- Familiarize oneself with the process of overhead cost allocation through different activity drivers.