Wedd Corporation uses activity-based costing to assign overhead costs to product

Question

Wedd Corporation uses activity-based costing to assign overhead costs to products. Overhead costs have already been allocated to the company's three activity cost pools as follows: Processing, $48,300; Supervising, $28,800; and Other, $19,600. Processing costs are assigned to products using machine-hours (MHs) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data appear below: MHs (Processing) Batches (Supervising) Product O6 16,500 1,530 Product D7 1,120 340 Total 17,620 1,870 What is the overhead cost assigned to Product O6 under activity-based costing? (Round your intermediate calculations to 2 decimal places.)

Explanation / Answer

overhead rate overhead rate processing (48,300/(16500+1120) 2.74 Supervising 28800/(1530+340)= 15.40 overhead allocated prodcut O6 processing 2.74*16500 45210 Supervising (15.4*1530) 23562 overhead allocated 68772 answer

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