Schoeninger, Inc., manufactures and sells two products: Product X1 and Product I6. The company has an activity-based costing system with the following activity cost pools, activity measures, and expected activity: The activity rate for the Labor-Related activity cost pool under activity-based costing is closest to:

Question

Schoeninger, Inc., manufactures and sells two products: Product X1 and Product I6. The company has an activity-based costing system with the following activity cost pools, activity measures, and expected activity:  The activity rate for the Labor-Related activity cost pool under activity-based costing is closest to:

Quizplus · Accepted Answer

To calculate the activity rate for the Labor-Related activity cost pool, we need to divide the total expected cost of labor-related activities ($454,200) by the total expected activity level (15,000 direct labor hours). This gives us an activity rate of $30.23 per direct labor hour (=$454,200/15,000). Therefore, the best choice is B.