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Mirabile Corporation uses activity-based costing to compute product margins. Overhead costs have already been allocated to the company's three activity cost pools-Processing, Supervising, and Other.
Mirabile Corporation uses activity-based costing to compute product margins. Overhead costs have already been allocated to the company's three activity cost pools-Processing, Supervising, and Other. The costs in those activity cost pools appear below: Processing $ 5,265 Supervising $34,340 Other $11,100 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 appear below: Batches MHs (Processing) (Supervising) Product Me Product M5 Total 12,800 700 850 850 1,700 13,500 Finally, sales and direct cost data are combined with Processing and Supervising costs to determine product margins Sales (total) Direct materials (total) Direct labor (total) Product M0 Product M5 $81,200 93,400 $ 29,200 32,100 $ 28,500 42,400 The activity rate for the Supervising activity cost pool under activity-based costing is closest to
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