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 $ 47,000 Supervisory expense $ 6,000 Distribution of Resource Consumption Across Activity Cost Pools: Activity Cost Pools Machining Order Filling Other Equipment depreciation 0.60 0.10 0.30 Supervisory expense 0.60 0.20 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: MHs (Machining) Orders (Order Filling) Product C9 6,900 200 Product U0 3,100 800 Total 10,000 1,000 What is the overhead cost assigned to Product C9 under activity-based costing? Multiple Choice $26,500 $21,942 $1,180 $23,122

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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 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	$ 47,000
Supervisory expense	$ 6,000

Distribution of Resource Consumption Across Activity Cost Pools:

	Activity Cost Pools
	Machining	Order Filling	Other
Equipment depreciation	0.60	0.10	0.30
Supervisory expense	0.60	0.20	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:

	MHs (Machining)	Orders (Order Filling)
Product C9	6,900	200
Product U0	3,100	800
Total	10,000	1,000

The activity rate for the Machining activity cost pool under activity-based costing is closest to:

Multiple Choice

$18.00 per MH

$5.30 per MH

$2.82 per MH

$3.18 per MH