Machuga,Inc. ,manufactures and sells two products: Product C1 and Product M2.Data concerning the expected production of each product and the expected total direct labor-hours (DLHs)required to produce that output appear below: The direct labor rate is $18.70 per DLH.The direct materials cost per unit is $297.00 for Product C1 and $246.20 for Product M2. The company is considering adopting an activity-based costing system with the following activity cost pools,activity measures,and expected activity: The overhead applied to each unit of Product M2 under activity-based costing is closest to:
A)$1,118.13 per unit
B)$1,013.40 per unit
C)$1,122.22 per unit
D)$647.22 per unit

Question

Machuga,Inc. ,manufactures and sells two products: Product C1 and Product M2.Data concerning the expected production of each product and the expected total direct labor-hours (DLHs)required to produce that output appear below:  The direct labor rate is $18.70 per DLH.The direct materials cost per unit is $297.00 for Product C1 and $246.20 for Product M2. The company is considering adopting an activity-based costing system with the following activity cost pools,activity measures,and expected activity:  The overhead applied to each unit of Product M2 under activity-based costing is closest to:
A)$1,118.13 per unit 
B)$1,013.40 per unit 
C)$1,122.22 per unit 
D)$647.22 per unit

Quizplus · Accepted Answer

Computation of activity rates:
 11eaa3fe_337f_b71e_908b_67977b8eafe1_TB2461_00 Computation of the overhead cost per unit under activity-based costing.
 11eaa3fe_337f_b71f_908b_ad49e7eb4083_TB2461_00