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mework Saved Help Save & Exit S Check my wol A company uses activity-based costing to determine the costs of its three produc
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Answer #1

Solution:

Activity Expected Costs Expected Activity Driver Activity Rate
1 $134,550 $29,275 $4.60
2 $85,550 $24,700 $3.46
3 $79,395 $15,050 $5.28

Explanation:

First Second Third
Cost $134,550 $85,550 $79,395
A $19,800 $8,900 $5,800
B $79,00 $14,800 $6,800
C $1,575 $1,000 $2,450
Total $29,275 $24,700 $15,050
Rate

Activity rate =Activity Cost Pool / Level

For A:

$134,550/$29,275 = $4.596 or 4.60

For B:

=$85,500/$24,700 = $3.461 or $3.46

For C:

$79,395 / $15,050 = $5.275 or $5.28

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