Question
Tandem Company manufactures two products (D and F). The overhead costs ($89,750) have been divided into three cost pools that use the following activity drivers:
Tandem Company manufactures two products (D and F). The overhead costs ($89,750) have been divided into three cost pools that use the following activity drivers:
| Product | Number of Setups | Machine Hours | Packing Orders |
| D | 10 | 500 | 75 |
| F | 10 | 2,000 | 175 |
| Cost per pool | $11,000 | $60,000 | $18,750 |
What is the allocation rate per packing order using activity-based costing?
a.$1,875
b.$18,750
c.$75
d.$250
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Financial Accounting A User Perspective
Authors: Robert E. Hoskin, Maureen R. Fizzell, Donald C. Cherry
4th Canadian Edition
0470834455, 978-0470834459
