Answer the following questions using the information below:
Mayan Potters manufactures two sizes of ceramic paperweights, regular and jumbo. The following information applies to their expectations for the planning period:
Mayan Potters uses an ABC system and assigns overhead costs based on the overhead activity information provided above.
-The materials handling activity-cost driver rate is:
A)$2.00
B)$20.00
C)$0.50
D)$5.00

Question

Answer the following questions using the information below:
Mayan Potters manufactures two sizes of ceramic paperweights, regular and jumbo. The following information applies to their expectations for the planning period:
   Mayan Potters uses an ABC system and assigns overhead costs based on the overhead activity information provided above.
-The materials handling activity-cost driver rate is:
A)$2.00 
B)$20.00 
C)$0.50 
D)$5.00

Quizplus · Accepted Answer

The materials handling activity-cost driver rate is calculated as total materials handling costs ($40,000) divided by total materials handling activity ($80,000). Therefore, the materials handling activity-cost driver rate is $0.50 per dollar of materials handling activity.

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