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Forner, Inc., manufactures and sells two products: Product Z1 and Product Z8. The company has an activity-based costing system with the following activity cost pools,
Forner, Inc., manufactures and sells two products: Product Z1 and Product Z8. The company has an activity-based costing system with the following activity cost pools, activity measures, and expected activity:
Estimated Expected Activity Activity Cost Pools Activity Measures Overhead Cost Product Z1 Product Z8 Total Labor-related DLHs $ 112,190 600 2,000 2,600 Machine setups setups 40,440 500 700 1,200 Order size MHs 609,770 3,000 3,200 6,200 $ 762,400
The activity rate for the Machine Setups activity cost pool under activity-based costing is closest to:
Multiple Choice -
$203.26 per setup
-
$190.55 per setup
-
$122.97 per setup
-
$33.70 per setup
Forner, Inc., manufactures and sells two products: Product Z1 and Product Z8. The company has an activity-based costing system with the following activity cost pools, activity measures, and expected activity:
| Estimated | Expected Activity | |||||
| Activity Cost Pools | Activity Measures | Overhead Cost | Product Z1 | Product Z8 | Total | |
| Labor-related | DLHs | $ | 112,190 | 600 | 2,000 | 2,600 |
| Machine setups | setups | 40,440 | 500 | 700 | 1,200 | |
| Order size | MHs | 609,770 | 3,000 | 3,200 | 6,200 | |
| $ | 762,400 | |||||
| | ||||||
The activity rate for the Machine Setups activity cost pool under activity-based costing is closest to:
Multiple Choice-
$203.26 per setup
-
$190.55 per setup
-
$122.97 per setup
-
$33.70 per setup
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