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Assume a company that uses activity based costing (ABC) has only two products - A and B. The company does not have any organization Sustaining
Assume a company that uses activity based costing (ABC) has only two products - A and B. The company does not have any organization Sustaining activities or unused capacity costs. The company's total manufacturing overhead cost of $56,000 has been allocated to the three activities shown below: Setups 20 20 Activity measure quantity: Product A Activity measure quantity: Product B Overhead cost per activity cost pool Activity rate Machining 1,000 ? ? $ 8 PET MH Packing Orders 150 350 $10,000 ? $150 per setup The activity rate for the Packing Orders activity is closest to: Multiple Choice $20.00 per order O $66.67 per order 0 $28.57 per orde o $30.00 per order
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