Question
Please show work for A, B, and C 6. Forrer Company has two products: A and B. The annual production and sales level of Product
Please show work for A, B, and C
6. Forrer Company has two products: A and B. The annual production and sales level of Product A is 18,188 units. The annual production and sales level of Product B is 31,652. The company uses activity-based costing and has prepared the following analysis showing the estimated total cost and expected activity for each of its three activity cost pools.
Activity Cost Pool Estimated Cost Expected Activity
Product A Product B
Activity 1 $ 80,000 200 800
Activity 2 360,000 600 5,400
Activity 3 58,400 1,000 500
Part (a) What is the total overhead cost allocated to Product B under activity-based costing?
Part (b) What is the overhead cost per unit of Product B under activity-based costing?
Part (c) Compute the profit margin for Product B using activity-based costing.
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