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Assume that a pet food manufacturer is considering adding two types of pet food to its existing product line. Research had determined that good demand
Assume that a pet food manufacturer is considering adding two types of pet food to its existing product line. Research had determined that good demand exists for dog food in 40-pound bags and cat food in 1/2 pound cans. The company identified the following partial list of activities, costs, and activity drivers expected for the next year: Activity Handling materials Storage costs Expected Costs Cost Driver $105,000 Number of batches made $820,000 Weight of finished product Production volume Batches made Dog Food 100,000 units 200 batches Cat Food 200,000 units 150 batches 23. Required information Refer to the data above. What are the overhead rates used to apply material handling (MH) and storage costs (SC) using activity-based costing? MH $300/batch, SC $2.73/unit MH $300/batch SC $.20/b. O O MH $525/batch, SC $.205/unit O MH $700/batch: SC $ 205/lb. O MH $700/batch: SC $8.20/1b
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