two products: Product EB and Product R4. The company has an expected Bewig, Inc.

Question

two products: Product EB and Product R4. The company has an expected Bewig, Inc., manufactures and sells activity-based costing system with the following activity cost pools, activity measures, and activity: Estimated Expected Activity OverheadP Cost Cost Activity Pools Measures Labor- related Product Product R4 Total E8 DLHs $201,717| 4,80? 4,500| 9,300 setups 69,020400300700 setups General MHs 140,5533,3003,000 6,300 $411,290 The activity rate for the Machine Setups activity cost pool is closest to: A. $46.85 per setup B. $98.60 per setup C. $42.59 per setup D. $65.28 per setup

Explanation / Answer

B. $98.60 per setup

Activity rate = Estimated overhead cost ÷ Total expected activity= $69,020 ÷ 700 setups = $98.60 per setup

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