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Matt Company uses activity-based costing. The company has two products: A and B. The annual production and sales of Product A is 8,000 units and
Matt Company uses activity-based costing. The company has two products: A and B. The annual production and sales of Product A is 8,000 units and of Product B is 6,000 units. There are three activity cost pools, with estimated total cost and expected activity as follows: Activity Estimated Expected Activity Cost Pool Cost Product A Product B Total Activity 1 $20,000 100 400 500 Activity 2 $37,000 800 200 1,000 Activity 3 $91,200 800 3,000 3,800 The cost per unit of Product A under activity-based costing is closest to: $2.40. $3.90. $10.59. $6.60
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