Bachrodt Corporetion uses actvity-besed costing to copute product mengins. Overh

Question

Bachrodt Corporetion uses actvity-besed costing to copute product mengins. Overhead costs have alreedy been elloceted to the compeny's three activity cost pools-Processing, Supervising, and Cther The costs in those ectvity cost pools appear below Proceaaing $21,600 3,700 $10,700 Processing costs ere esigned to products using mechine hours MHs) and Supervising costs ete essigned to products using the sumber of betches. The costs in the OUher ectivity cost poolae not ensigned to products. Activity date epoeer below 3,700 Produet vo Total 6,300 10,000 ,000 nnely, sales and direct cost dete re combined with Processrs and Supervsing costs to determine product m ains. 17 vo 102,200 78.900 Direct materials (total) $ 40,800 $39,100 47,200 822,300 biracl labor (LOLal What is tha owarhad costassignad to Produt Y7 undar actiulty-based costing? 7992 1480 9472

Explanation / Answer

Note : Since other overhead costs are not assigned to any of the product , thus won't be consider for determining individual product margin

Caculation of Assigned Overhead costs for Product Y7 using activity based costing

Cost Activity rate Working Assigned Overhead costs Processing $21,600 /10,000 MHs = $2.16 per MHs 3,700 MHs * $2.16 $7,992 Supervising $3,700 /1,000 batches = $3.7 per batch 400 batches * $3.7 $1,480 Total Assigned Overhead costs $9,472 (ie option d)

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