4) Mayeux Corporation uses an activity-based costing system with three activity

Question

4) Mayeux Corporation uses an activity-based costing system with three activity cost pools. The company has provided the following data concerning its costs and its activity-based costing system: Costs: Wages and salaries Depreciation Utilities Total S 320,000 160,000 240,000 S 720,000 Distribution of resource consumption: Activity Cost Pools Other 10% 35% 35% Total 100% 100% 100% Assembly Setting Up | Wages and salaries Depreciation Utilities 50% 10% 15% 4000 55% 50% How much cost, in total, would be allocated in the first-stage allocation to the Setting Up activity cost pool? A) $360,000 B) $336,000 C) $288,000 D) $348,000

Explanation / Answer

Calculate setting up activity cost pool under first stage allocation :

so answer is b) $336,000

Setting up Wages and salaries 128000 Depreciation 88000 Utilities 120000 Total 336000

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