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Handal Corporation uses activity-based costing to compute product margins. Overhead costs have already been allocated to...

Handal Corporation uses activity-based costing to compute product margins. Overhead costs have already been allocated to the company's three activity cost pools--Machining, Order Filling, and Other. The costs in those activity cost pools appear below:

Machining $ 9,520
Order Filling $ 22,984
Other $ 6,700

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 data appear below:

MHs
(Machining)
Orders (Order Filling)
Product O4 3,100 220
Product S1 10,500 1,140

Finally, sales and direct cost data are combined with Machining and Order Filling costs to determine product margins.

Product O4 Product S1
Sales (total) $ 88,100 $ 94,600
Direct materials (total) $ 40,800 $ 30,000
Direct labor (total) $ 35,100 $ 36,200

What is the overhead cost assigned to Product S1 under activity-based costing? (Round the Intermediate calculation to two decimal places and your final answer to nearest whole dollar.)

Multiple Choice

  • $14,700

  • $19,266

  • $26,616

  • $7,350

0 0
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Answer #1

Activity Rate Determination of Activity rates :- Activity Cost Estimated Estimated Pool Overhead Activity Machining 9,520 13,

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