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hrome File Edit View History Bookmarks People Window Help Assignments: ACG 2071-CRN x O ezto.mheducation.com/hm.tpx Chapter Quiz 3 x-( G Overhead costs: Equpment C Ollivier Corporation has an activity-based costing system with three activity cost pools-Processing Supervising, and Other. In the first stage allocations, costs in the two overhead accounts, equipment expense and indirect labor, are allocated to the three activity cost pools based on resource consumption. Data used in the first stage allocations follow Overhead costs: Equipment expense Indirect labor Distribution of Resource Consumption Across Activity Cost Pools: 40 40 Indirect labor 10 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 for the company's two products follow 10,100 Product L Total What is the overhead cost assigned to Product L7 under activity-based costing? (Round your intermediate celculations to 2 decimal places and your final answer to nearest whole dollar) O $5,593 O $39757 O s3064 O $49735Explanation / Answer
Equipment expenses $123,000 : Allocation to Processing &Supervising
Indirect Labour $11,800 : Allocation to Processing &Supervising
Therefore total overheads allocated to processing = $49,200 + $4,720 =$53,920 &
total overheads allocated to supervising = $61,500 + $5,900 = $67,400
Computation of Total Overhead cost assigned to Product L7
Therefore required overhead cost assigned to Product L7 using activity based costing is $39,757
Activity cost pools Assigned to Working Amount($) Processing costs Machine hours ($53,920 / 11,270 hrs)= 4.78 per hr * 1,170 hrs 5,593 Supervising costs Number of batches ($67,400 / 2,880 batches) = 23.4 per batch* 1,460 batches 34,164 Total $39,757Related Questions
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