Millner Corporation has provided the following data from its activity-based costing accounting system: The activity rate for the Designing Products activity cost pool is closest to:
A)$101 per product design hour
B)$1,372,448 per product design hour
C)$176 per product design hour
D)$57 per product design hour

Question

Millner Corporation has provided the following data from its activity-based costing accounting system:  The activity rate for the Designing Products activity cost pool is closest to:
A)$101 per product design hour 
B)$1,372,448 per product design hour 
C)$176 per product design hour 
D)$57 per product design hour

Quizplus · Accepted Answer

To calculate the activity rate, we divide the total cost of each activity cost pool by the total expected activity. For the Designing Products activity cost pool, the total cost is $1,760,000 and the expected activity is 10,000 product design hours. Therefore, the activity rate is $176 per product design hour.

Millner Corporation Has Provided the Following Data from Its Activity-Based