Whiting Corporation has provided the following data concerning its overhead cost

Question

Whiting Corporation has provided the following data concerning its overhead costs for the coming year:



The company has an activity-based costing system with the following three activity cost pools and estimated activity for the coming year:



The Other activity cost pool does not have a measure of activity; it is used to accumulate costs of idle capacity and organization-sustaining costs.
The distribution of resource consumption across activity cost pools is given below:



The activity rate for the Assembly activity cost pool is closest to:

Explanation / Answer

Wages and Salaries:10% × $480,000 = 48,000 Depreciation: 20% ×$220,000 = 44,000 Utilities: 30% × $160,000 =48,000 Total = $140 ,000 Activity rate = 140,000 / 20,000 = 7

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