Maurice Tutor

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    Argosy University/ Phoniex University/
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    Phoniex University
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Category > Accounting Posted 22 Jul 2017 My Price 6.00

Laguna Corporation

Laguna Corporation has provided the following data concerning its overhead costs for the coming year:

Wages and salaries

$260,000

Depreciation

100,000

Rent .

180,000

Total

$540,000

The company has an activity-based costing system with the following three activity cost pools and estimated activity for the coming year:

Activity Cost Pool

Total Activity

Assembly

50,000 labor-hours

Order processing

400 orders

Other

Not applicable

The Other activity cost pool does not have a measure of activity; it is used to accumulate costs of idle capacity and organization-sustaining costs.

The distribution of resource consumption across activity cost pools is given below:

 

Activity Cost Pools

 

Assembly

Order Processing

Other

Total

Wages and salaries

60%

20%

20%

100%

Depreciation

5%

60%

35%

100%

Rent

30%

30%

40%

100%

The activity rate for the Order Processing activity cost pool is closest to:

A) $415 per order

B) $405 per order

C) $495 per order

D) $270 per order

Answers

Maurice Tutor
(5)
Status NEW Posted 22 Jul 2017 10:07 AM My Price 6.00

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