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Lysiak Corporation uses an activity based costing system to assign overhead costs to products. In the first stage, two overhead costs-- equipment depreciation and supervisory
Lysiak Corporation uses an activity based costing system to assign overhead costs to products. In the first stage, two overhead costs-- equipment depreciation and supervisory expense-are allocated to three activity cost pools--Machining, Order Filling, and Other--based on resource consumption. Data to perform these allocations appear below: Overhead costs: Equipment depreciation Supervisory expense $47, 000 $ 6,000 Distribution of Resource Consumption Across Activity Cost Pools: Activity Cost Pools Order Filling 0.10 0. 20 Machining 0.60 0.60 Equipment depreciation Supervisory expense Other 0.30 0. 20 In the second stage, Machining costs are assigned to products using machine-hours (MHS) and Order Filling costs are assigned to products using the number of orders. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow: Activity: Orders (Order Filling) 200 800 MHs (Machining) 6, 900 3, 100 10,000 Product C9 Product UO Total 1, 000 What is the overhead cost assigned to Product C9 under activity-based costing
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