Library Resources Company uses activity-based costing. The company produces soft

Question

Library Resources Company uses activity-based costing. The company produces soft and hard-cover books. The estimated costs and expected activity for each of the activity pools follow:
Activity Estimated Expected Activity
Cost Pool Cost Hard-Cover Soft-Cover Total
Activity 1 $15,675 800 300 1,100
Activity 2 $11,900 500 200 700
Activity 3 $36,000 800 400 1,200
To which of the following is the rate for activity 3 that will used to apply costs to Soft-cover books closest?

$90.00

$12,000

$30.00

Not enough information is provided.

Explanation / Answer

$90.00

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