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Question

A company uses activity-based costing to determine the costs of its three products: A, B, and C. The budgeted cost and activity for each of the company's three activity cost pools are shown in the following table:

               Budgeted Activity  

Activity Cost Pool                               Budgeted Cost                     Product A             Product B             Product C    

Activity 1                                                    $78,000                                    6,800                      9,800                     20,800      

Activity 2                                                    $ 53,000                                   7,800                      15,800                  8,800      

Activity 3                                                    $ 98,000                                   3,300                      1,800                    2,425      

How much overhead will be assigned to Product B using activity-based costing?

  • $69,726.04
  • $89,356.14
  • $68,822.42
  • $229,000.00
  • $78,000.00
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