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Olmo, Inc., manufactures and sells two products: Product K0 and Product H9. The annual production and sales of Product of K0 is 900 units and

Olmo, Inc., manufactures and sells two products: Product K0 and Product H9. The annual production and sales of Product of K0 is 900 units and of Product H9 is 900 units. The company has an activity-based costing system with the following activity cost pools, activity measures, and expected activity:

Activity Cost Pools Activity Measures Estimated Overhead Cost Expected Activity
Product K0 Product H9 Total
Labor-related DLHs $ 550,508 1,800 900 2,700
Production orders orders 53,519 1,000 600 1,600
Order size MHs 836,116 3,700 3,400 7,100
$ 1,440,143

The overhead applied to each unit of Product K0 under activity-based costing is closest to: (Round your intermediate calculations to 2 decimal places.)

rev: 03_25_2018_QC_CS-119201

Multiple Choice

  • $407.78 per unit

  • $929.07 per unit

  • $484.12 per unit

  • $1,600.13 per unit

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