Kraska Corporation has provided the following data from its activity-based costi

Question

Kraska Corporation has provided the following data from its activity-based costing system:
Activity Cost Pool Total Cost Total Activity
Assembly $460,000 39,000 machine-hours
Processing orders $33,100 960 orders
Inspection $107,712 1,300 inspection-hours

Data concerning one of the company’s products, Product O11W, appear below:
Selling price per unit $96.0
Direct materials cost per unit $17.6
Direct labor cost per unit $13.0
Annual unit production and sales 320.0
Annual machine-hours 890.0
Annual orders 87.0
Annual inspection-hours 23.0


According to the activity-based costing system, the product margin for product O11W is (round activity rates to 2 decimal places):


1. 1,531.20

2. 7,905.05

3. 5,525.20

4. 4,160.00

Explanation / Answer

4160.00

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