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Rusties Company recently implemented an activity-based costing system. At the beginning of the year, management made the following estimates of cost and activity in the
Rusties Company recently implemented an activity-based costing system. At the beginning of the year, management made the following estimates of cost and activity in the company's five activity cost pools Expected Overhead Cost $22,125 $ 2,375 $ 4,640 $ 810 $58,000 Expected Activity Activity Cost Pool Labor-related Purchase orders Product testing Template etching General factory Activity Measure Direct labor-hours Number of orders Number of tests Number of templates Machine-hours 1,475 DLHs 475 orders 290 tests 30 templates 7,250 MHs 2. The expected activity for the year was distributed among the company's four products as follows: Expected Activity Activity Cost Pool Labor-related (DLHs) Purchase orders (orders) Product testing (tests) Template etching (templates) General factory (MHs) Product A Product B Product C Product D 475 100 170 200 400 150 400 170 60 60 16 1,450 10 1,600 2,100 2,100 Using the ABC data, determine the total amount of overhead cost assigned to each product. Total Overhead Cost Product A Product B ProductC Product D
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