Figure 4-8
Tandem Company manufactures two products (D and F). The overhead costs ($84,000) have been divided into three cost pools that use the following activity drivers:

-Refer to Figure 4-8. What is the allocation rate per setup using activity-based costing?
A) $ 550
B) $1,100
C) $11,000
D) $2,200

Question

Figure 4-8
Tandem Company manufactures two products (D and F). The overhead costs ($84,000) have been divided into three cost pools that use the following activity drivers:
 
-Refer to Figure 4-8. What is the allocation rate per setup using activity-based costing?
A) $ 550 
B) $1,100 
C) $11,000 
D) $2,200

Quizplus · Accepted Answer

The allocation rate per setup using activity-based costing is $550. This is calculated by dividing the total setup costs of $11,000 by the number of setups, which is 20.

Figure 4-8 Tandem Company Manufactures Two Products (D and F). the Overhead