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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
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: 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 Expected Overhead Cost $ 18,000 $ 1,050 $ 3,500 $ 700 $ 50,000 Expected Activity 2,000 DLHS 525 orders 350 tests 28 templates 10,000 MHS 2. The expected activity for the year was distributed among the company's four products as follows: Activity Cost Pool Labor-related (DLS) Purchase orders (orders) Product testing (tests) Template etching (templates) General factory (MHS) Product A Product B Product C Product D Expected Activity 500 80 100 700 700 105 180 160 200 0 60 0 90 14 10 4 3,400 2,200 1,800 2,600 Using the ABC data, determine the total amount of overhead cost assigned to each product.
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