Question
. A company has two products: Cakes and Cookies. It uses activity-based costing and has prepared the following analysis showing budgeted costs and activities.
. A company has two products: Cakes and Cookies. It uses activity-based costing and has prepared the following analysis showing budgeted costs and activities. Use this information to compute (a) the company's overhead rates for each of the three activities and (b) the amount of overhead allocated to Cakes. Budgeted Activity Cost Pool Overhead Cost Product: Product: Cakes Cookies Total Activity 1 $75,000 750 750 1,500 Activity 2 $75,000 1,700 1,300 3,000 Activity 3 $85,000 400 600 1,000 Total Budgeted $235,000 overhead
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