Asked by Tiana Hailey on May 14, 2024
Verified
The activity rate under the activity-based costing system for Activity 3 is closest to:
A) $33.33.
B) $29.32.
C) $30.00.
D) $41.53.
Activity-Based Costing
A method of costing that identifies activities in an organization and assigns the cost of each activity to products or services according to the actual consumption of each.
Expected Activity
This term refers to the estimated level of operations or production expected to be achieved in a future period.
- Compute activity proportions and allocate overhead expenses to products under Activity-Based Costing.
Verified Answer
HC
Heidi CasianoMay 20, 2024
Final Answer :
C
Explanation :
The activity rate for Activity 3 is calculated by dividing the estimated overhead cost by the total expected activity for that cost pool. For Activity 3, this is \$90,000 / 3,000 = \$30.00.
Learning Objectives
- Compute activity proportions and allocate overhead expenses to products under Activity-Based Costing.