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Q2) Eastern recently adopted an activity-based costing (ABC) system with the following overhead costs and drivers. Cost Pool Material ordering Equipment setup Annual Amount
Q2) Eastern recently adopted an activity-based costing (ABC) system with the following overhead costs and drivers. Cost Pool Material ordering Equipment setup Annual Amount Annual Driver 2,000 purchase orders $100,000 $200,000 2,000 setups Machine related Miscellaneous $300,000 5,000 machine hours $400,000 $500,000 of product costs other than miscellaneous overhead $1,000,000 Total overhead Recently, the company received an order from Southern. Eastern estimates the following costs and activities related to the order: Material cost $700 Purchase orders 15 Labor cost Setups $800 5 Employee's 40 Machine hours 100 Calculate the total cost of the Southern job using the new ABC system.
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