Bearington Enterprises uses an activity-based costing system to assign costs in its auto-parts division. Est. Indirect Activity Costs Activity Materials Assembling Packaging $60,000 $175,000 $70,000 |Allocation Base Material moves Direct labor hours # of finished units Cost Allocation Rate $5.00/move $5.00/dir. Iabor hour $2.50/finished unit The following units were produced in December with the following information: Part # Part 001 Part 002 Part 003 # Produced 1,250 3,500 3,750 Materials Costs $2,500 $6,000 $7,000 # Moves 100 500 2,500 Dir. Labor Hours. 200 300 1,250 Total unit cost for Part 002 is closest to (rounded): $5.36. O 5.70. $9.37. $3.64.

FINANCIAL ACCOUNTING
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Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Bearington Enterprises uses an activity-based costing system to assign costs in its auto-parts division.
Est. Indirect Activity
Costs
Cost Allocation Rate
$5.00/move
$5.00/dir. labor hour
$2.50/finished unit
Allocation Base
Activity
Materials
Assembling
Packaging
$60,000
$175,000
$70,000
Material moves
Direct labor hours
# of finished units
The following units were produced in December with the following information:
# Produced
1,250
3,500
3,750
Dir. Labor Hours.
Part #
Part 001
Part 002
Part 003
Materials Costs
$2,500
$6,000
$7,000
# Moves
100
500
200
2,500
300
1,250
Total unit cost for Part 002 is closest to (rounded):
$5.36.
$5.70.
$9.37.
$3.64.
Transcribed Image Text:Bearington Enterprises uses an activity-based costing system to assign costs in its auto-parts division. Est. Indirect Activity Costs Cost Allocation Rate $5.00/move $5.00/dir. labor hour $2.50/finished unit Allocation Base Activity Materials Assembling Packaging $60,000 $175,000 $70,000 Material moves Direct labor hours # of finished units The following units were produced in December with the following information: # Produced 1,250 3,500 3,750 Dir. Labor Hours. Part # Part 001 Part 002 Part 003 Materials Costs $2,500 $6,000 $7,000 # Moves 100 500 200 2,500 300 1,250 Total unit cost for Part 002 is closest to (rounded): $5.36. $5.70. $9.37. $3.64.
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