Immen Corporation manufactures two products: Product B820 and Product P997. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products B820 and P99Y. Activity Cost Pool Machining Machine setups Product design Order size Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Total Cost $ 330,000 $ 300,000 $ 46,000 $ 330,000 Total Activity 15,000 MHS 500 setups 2 products 10,000 DLHs Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Product Product B820 P99Y 7,000 8,000 200 300 1 1 3,000 7,000 Using the plantwide overhead rate, how much manufacturing overhead cost would be allocated to Product B820? Multiple Choice $704,200 $301,800 $610,000 $503,000 Immen Corporation manufactures two products: Product B820 and Product P99Y. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products B820 and P99Y. Activity Cost Pool Machining Machine setups Product design Order size Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Total Cost $ 330,000 $ 300,000 $ 46,000 $ 330,000 Total Activity 15,000 MHS 500 setups 2 products 10,000 DLHs Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Product Product B820 P99Y 7,000 8,000 200 300 1 1 3,000 7,000 Using the plantwide overhead rate, how much manufacturing overhead cost would be allocated to Product P99Y? Multiple Choice $503,000 $704,200 $396,000 $301,800 Immen Corporation manufactures two products: Product B820 and Product P99Y. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products B820 and P99Y. Activity Cost Pool Machining Machine setups Product design Order size Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Total Cost $ 330,000 $ 300,000 $ 46,000 $ 330,000 Total Activity 15,000 MHS 500 setups 2 products 10,000 DLHs P99Y Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Product Product B820 7,000 8,000 200 300 1 1 3,000 7,000 Using the ABC system, how much total manufacturing overhead cost would be assigned to Product B820? Multiple Choice $503,000 $297,000 $396,000 $99,000 Deemer Corporation has an activity-based costing system with three activity cost pools--Processing, Supervising, and Other. In the first stage allocations, costs in the two overhead accounts, equipment expense and indirect labor, are allocated to the three activity cost pools based on resource consumption. Data used in the first stage allocations follow: Overhead costs: Equipment expense Indirect labor $ 49,000 $ 11,600 Distribution of Resource Consumption Across Activity Cost Pools: Activity Cost Pools Processing Supervising Other 0.50 0.40 0.10 0.50 0.40 0.10 Equipment expense Indirect labor Processing costs are assigned to products using machine-hours (MHs) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow: Activity: Product F6 Product Xo Total MHS Batches (Processing) (Supervising) 9,600 580 1,500 520 11,100 1,100 The activity rate for the Supervising activity cost pool under activity-based costing is closest to: Multiple Choice $17.34 per batch $8.67 per batch 5 or batch
