Question

Huelskamp Corporation has provided the following data concerning its overhead costs for the coming year. Question 5 Not yet answered Points out of 1.00 Wages and salaries..... Depreciation Rent Total $360,000 120.000 180,000 $660,000 P Flag question The company has an activity-based costing system with the following three activity cost pools and estimated activity for the coming year Activity Cost Pool Assembly... Order processing Total Activity 60,000 labor-hours 400 orders Not applicable Other The Other activity cost pool does not have a measure of activity, it is used to accumulate costs of idle capacity and organization-sustaining costs The distribution of resource consumption across activity cost pools is given below Wages and salaries... Depreciation Assembly 25% 15% Activity Cost Pools Order Processing Other 65% 10% 45% 40% 40% 25% Total 100% 100% 100% Rent The activity rate for the Assembly activity cost pool is closest to: Select one: a. $2.65 per labor-hour O b. $3.85 per labor-hour O c. $2.85 per labor-hour O d. 52.75 per labor-hour

Answer 1

Total Overhead

= Wages (360,000*25%) + Depreciation (120,000*15%) + rent (180,000*35%)

= 90,000+18,000+63,000 = 171,000

Activity rate = 171,000/60,000

= 2.85 per labor hours