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 $ 3,800 Supervising $23,800 Other $10,400 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: MHS Batches (Processing) (Supervising) Product 9,700 500 M5 300 10,000 500 1,000 Total Finally, sales and direct cost data are combined with Processing and Supervising costs to determine product margins. Product Product MO M5 $ 74,100 $89,900 Direct materials (total) Direct labor (total) $28,500 $31,400 $27,800 $41,700 O O $16,800 O $2,686 O $18,000 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 Machining Order Filling 0.60 0.10 0.60 0.20 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: MHS (Machining) Product C9 Orders (Order Filling) 200 800 1,000 3,100 10,000 Total How much overhead cost is allocated to the Machining activity cost pool under activity-based costing in the first stage of allocation? Multiple Choice O O $15,300 O $3,600 O $31,800 Cumberland Enterprises makes a variety of products that it sells to other businesses. The company's activity-based costing system has four activity cost pools for assigning costs to products and customers. Details concerning that ABC system are listed below: Activity Rate Supporting assembly $ 5.65 per DLH Activity Measure Direct labor-hours (DLHS) Number of batches Number of orders Number of customers Processing batches $ 146.65 per batch $ 80.05 per order $2,663.00 per customer Serving customers The cost of serving customers, $2,663.00 per customer, is the cost of serving a customer for one year. Steckman Corporation buys only one of the company's products which Cumberland Enterprises sells for $22.05 per unit. Last year Steckman Corporation ordered a total of 1,200 units of this product in 4 orders. To fill the orders, 8 batches were required. The direct materials cost is $7.65 per unit and the direct labor cost is $5.20 per unit. Each unit requires 0.30 DLHs. According to the ABC system, the customer margin for this customer this past year was closest to: Multiple Choice 0 $4,849.60 0 $17,280.00 0 $11,040.00 0 $20,269.60
