Mustafa 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, $2,737.00 per customer, is the cost of serving a customer for one year. Dahle Corporation buys only one of the company's products. The details of last year's purchases of this product are listed below:
According to the ABC system, the total cost of the activity "Supporting assembly" for this customer this past year was closest to:

Question

Mustafa 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, $2,737.00 per customer, is the cost of serving a customer for one year. Dahle Corporation buys only one of the company's products. The details of last year's purchases of this product are listed below:
 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 = $7.50 per DLH × 0.40 DLHs per unit × 800 units = $2,400.00

Mustafa Enterprises Makes a Variety of Products That It Sells