A company idenified the following partial list of activities, costs, and activit

Question

A company idenified the following partial list of activities, costs, and activity drivers expected for the next year Calculate activity rates for each of the three activities using activity-based costing (ABC). O Extrusion: $304 per batch; handling $32 per unit; packaging: $.03 per unit Extrusion: $83 per batch handling S32 per order; packaging: S.03 per unit Extrusion. $88 per order handling S32 per unit packaging $.03 per batch Extrusion $413 per batch handling $117 33 per order; packaging; S.054 per unit. Extrusion $118.13 per batch handling S44 per order packaging: S.0675 per unit.

Explanation / Answer

Extrusion cost 83600 Number of batches made Total batches 950 Cost per batch 88 Handling cost 8800 Number of orders filled Total orders 275 Cost per order 32 Packaging cost 40500 Number of units made Total Production volume 1350000 Cost per unit 0.03 Hence 2nd option is correct

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