159. A company uses activity-based costing to determine the costs of its three products: A, B and C. The activity rates and activity levels for each of the company’s three activity cost pools are shown in the following table:
|
|
Budgeted Activity
|
Activity Cost Pool
|
Activity Rate
|
Product A
|
Product B
|
Product C
|
Activity 1
|
$48
|
3,500
|
1,000
|
500
|
Activity 2
|
$51
|
300
|
2,100
|
600
|
Activity 3
|
$73
|
400
|
200
|
1,400
|
|
|
|
|
|
Compute the company’s budgeted overhead cost for each of the three products under activity-based costing.
160. A company has two products: X and Y. It uses activity-based costing and has prepared the following analysis showing budgeted cost and activity for each of its three activity cost pools.
|
|
Budgeted Activity
|
Activity Cost Pool
|
Budgeted Cost
|
Product X
|
Product Y
|
Activity 1
|
$3,600
|
25,200
|
46,800
|
Activity 2
|
$4,800
|
36,000
|
44,000
|
Activity 3
|
$6,300
|
43,200
|
46,800
|
|
|
|
|
Annual production and sales level of Product X is 161,100 units, and the annual production and sales level of Product Y is 275,200 units.
a. Compute the approximate overhead cost per unit of Product X under activity-based costing.
b. Compute the approximate overhead cost per unit of Product Y under activity-based costing.
161. A company has two products: Big and Little. It uses activity-based costing and has prepared the following analysis showing budgeted cost and activity for each of its three activity cost pools:
|
|
Budgeted Activity
|
Activity Cost Pool
|
Budgeted Cost
|
Big Product
|
Little Product
|
Activity 1
|
$72,000
|
1,200
|
2,800
|
Activity 2
|
$91,000
|
5,250
|
1,750
|
Activity 3
|
$88,000
|
3,200
|
4,800
|
|
|
|
|
Annual production and sales level of big product is 62,525 units, and the annual production and sales level of little product is 251,900 units.
a. Compute the approximate overhead cost per unit of big product under activity-based costing.
b. Compute the approximate overhead cost per unit of little product under activity-based costing.