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Wheatland Products manufactures and sells two products: Product EO14 and Product NO15. Data concerning the expected production of each product and the expected total direct
Wheatland Products manufactures and sells two products: Product EO14 and Product NO15. Data concerning the expected production of each product and the expected total direct labor hours (DLHrs required to produce that output appear below. Product EO14 Product NO15 Total DLHrs Expected Production 500 2,000 Labor-related Production orders Order size The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity: Activity Cost Pools Estimated Overhead Cost Expected Activity Product NO15 Activity Measures DLHrs per Unit 11.0 10.0 DLHrs Orders MHS Total DLHrs 5,500 20,000 25,500 $306,390 $65,587 $589,843 $961,843 Product EO14 5,500 1,300 6,000 20,000 1,400 5,700 The activity rate for the order size activity cost pool under activity-based costing is closest to: $50.42 per MH. $24.29 per MH. $15.32 per MH. $37.72 per MH. Total 25,000 2,700 11,700
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