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X Company uses an activity-based costing overhead allocation system. It has identified three activities and three...

X Company uses an activity-based costing overhead allocation system. It has identified three activities and three cost drivers. The activities and budgeted costs are as follows:

Activity Budgeted Cost
Setup $112,000      
Purchasing $58,000      
Machine Maintenance $55,000      


The following cost driver information is available for the company's only two products, A and B:

Cost Driver Product A Product B
setup hours 32,100     76,600    
purchase orders 51,000     40,100    
machine hours 69,900     50,600    


How much overhead was allocated to Product A? (round overhead rates to two decimal places)?

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Answer #1

Product A Product B Expected Activity Activity Expected Activity Overhead Overhead Activity Activity Rate Costs driver driver

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