Question

Help Save & Exit Doede Corporation uses activitybased costing to compute product margins. In the first stage, the activity-based costing system allocates two overhead accounts-equipment depreciation and supervisory expense-to three activity cost pools-Machining, Order Filling, and Other-based on resource consumption. Data to perform these allocations appear below. Overhead costs: Equipment depreciation Supervisory expense $92,000 $ 4,000 Distribution of Resource Consumption Across Activity Cost Pools: Activity Cost Pools Machining Order Filling Equipment depreciation 0.60 Supervisory expense 0.20 0.20 Other 0.20 0.50 0.30 In the second stage, Machining costs are assigned to products using machine-hours (MHs) and Order Filling costs are assigned to products using the number of orders. The costs in the other activity cost pool are not assigned to products. Activity: Product W1 Product Me Total MHS (Machining) 4,200 15,800 20,000 Orders (Order Filling) 800 200 1,000 Finally, sales and direct cost data are combined with Machining and Order Filling costs to determine product margins Next > 18 of 20 : < Prev

Answer 1