Bertsche Enterprises makes a variety of products that it sells to other businesses. The company's activity-based costing system has four activity cost pools for assigning costs to products and customers. Details concerning that ABC system are listed below: The cost of serving customers, $1,488.00 per customer, is the cost of serving a customer for one year.
Yousif Corporation buys only one of the company's products which Bertsche Enterprises sells for $25.00 per unit. Last year Yousif Corporation ordered a total of 900 units of this product in 3 orders. To fill the orders, 11 batches were required. The direct materials cost is $8.20 per unit and the direct labor cost is $7.65 per unit. Each unit requires 0.40 DLHs.
According to the ABC system, the total cost of the activity "Supporting assembly" for this customer this past year was closest to:

Question

Bertsche Enterprises makes a variety of products that it sells to other businesses. The company's activity-based costing system has four activity cost pools for assigning costs to products and customers. Details concerning that ABC system are listed below:  The cost of serving customers, $1,488.00 per customer, is the cost of serving a customer for one year.
Yousif Corporation buys only one of the company's products which Bertsche Enterprises sells for $25.00 per unit. Last year Yousif Corporation ordered a total of 900 units of this product in 3 orders. To fill the orders, 11 batches were required. The direct materials cost is $8.20 per unit and the direct labor cost is $7.65 per unit. Each unit requires 0.40 DLHs.
According to the ABC system, the total cost of the activity "Supporting assembly" for this customer this past year was closest to:

Quizplus · Accepted Answer

Supporting assembly = $3.20 per DLH × 0.40 DLHs per unit × 900 units = $1,152.00

Bertsche Enterprises Makes a Variety of Products That It Sells