X Company makes two products, A and B, and uses an activity-based costing overhead allocation system,...

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X Company makes two products, A and B, and uses an activity-based costing overhead allocation system, with three cost pools a

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Answer 1

Answer #1

Correct answer---------$85,249

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Calculation of Activity rates
Activity Cost Pool	Activity driver	Overhead Cost (A)	Expected Activity (B)	Activity rate (A/B)
Cost pool 1	Number of Activity	$ 106,000	159800	$ 0.66	Per Activity
Cost pool 2	Number of Activity	$ 52,000	106200	$ 0.49	Per Activity
Cost pool 3	Number of Activity	$ 25,000	123800	$ 0.20	Per Activity

.

Cost assigned to Product B
Activity name	Activity Rates	Activity	ABC Cost
	(A)	(B)	(A x B)
Cost pool 1	$ 0.66	76,400.00	$ 50,424
Cost pool 2	$ 0.49	50,500.00	$ 24,745
Cost pool 3	$ 0.20	50,400.00	$ 10,080
Total Overheads assigned			$ 85,249

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