Rusties Company recently implemented an activity-based costing system. At the be

Question

Rusties Company recently implemented an activity-based costing system. At the beginning of the year, management made the following estimates of cost and activity in the company

Rusties Company recently implemented an activity-based costing system. At the beginning of the year, management made the following estimates of cost and activity in the company

Rusties Company recently implemented an activity-based costing system. At the beginning of the year, management made the following estimates of cost and activity in the company's five activity cost pools:

Explanation / Answer

Activity Cost Pool Product A Product B Product C Product D Labor-related (DLHs) 7,600 * 8.8 = 66880 10,700 * 8.8 = 94160 4,100 * 8.8= 36080 9,600 *8.8 = 84480 Purchase orders (orders) 140 *78.666 =11013 190 *78.666 =14947 120 *78.666 =9440 250 *78.666 =19667 Product testing (tests) 110 *150 =16500 520 *150 =78000 220 *150 =33000 450 *150 =67500 Template etching (templates) 2,450 *40=98000 0 *40 =0 5,450 *40=218000 0 *40 =0 General factory (MHs) 12,900 *13.93 =179697 17,500 *13.93 =243775 13,100 *13.93 =182483 17,500 *13.93 =243775

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