Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Scholfield Enterprises makes a variety of products that it sells to other businesses. The company's activity - based costing system has four activity cost pools

image text in transcribed
Scholfield Enterprises makes a variety of products that it sells to other businesses. The company's activity-based costing system has four activity cost pools for assigning costs to products an customers. Details concerning that activity-based costing system are listed below:
\table[[Activity Cost Pool,Activity Measure,Activity Rate],[Supporting assembly,Direct labor-hours (DLHs),$6.55 per DLH],[Processing batches,Number of batches,$138.20 per batch],[Processing orders,Number of orders,$52.60 per order],[Serving customers,Number of customers,$1,191.00 per customer]]
The cost of serving customers, $1,191.00 per customer, is the cost of serving a customer for one year.
Latif Corporation buys only one of the company's products which Scholfield Enterprises sells for $15.60 per unit. Last year Latif Corporation ordered a total of 1,100units of this product in 2orders. To fill the orders. 7 batches were required. The direct materials cost is $7.85 per unit and the direct labor cost is $1.90 per unit. Each unit requires 0.10 direct labor-hours.
According to the activity-based costing system, the total cost of the activity "Processing batches" for this customer this past year was closest to:
Multiple Cholce
$967.40
$1,020.00
image text in transcribed

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Cornerstones of Managerial Accounting

Authors: Mowen, Hansen, Heitger

3rd Edition

324660138, 978-0324660135

More Books

Students also viewed these Accounting questions