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Midterm Company uses an activity-based cost system and has identified the following overhead activities, estimated costs, cost drivers, and estimated usage for the coming period.
Midterm Company uses an activity-based cost system and has identified the following overhead activities, estimated costs, cost drivers, and estimated usage for the coming period. Activity Estimated Cost Cost Driver Estimated Usage Ordering $120,000 Number of orders 300 orders Inspecting 90,000 Number of inspections 9,000 inspections Machining 210,000 Machine hours 20,000 machine hours $420,000 Midterm Company expects to use 10,500 direct labor hours for the period. The accounting records showed the following actual results for the production of A Product during the period A Product Prime cost $180,000 Direct labor hours 3,000 Number of orders 80 Number of inspections 1,200 Number of machine hours 5,000 Determine the product cost for A Product. $96,500 $240,000 $276,500 $390,000
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