Delauder Enterprises makes a variety of products that it sells to other businesses. The company's activity-based costing system has four activity cost pools for assigning costs to products and customers. Details concerning that activity-based costing system are listed below: Activity Cost Pool Supporting assembly Processing batches. Processing orders. Serving customers Activity Measure Direct labor-hours (DLHS) Number of batches. Number of orders. Number of customers. Number of units purchased Number of batches. Number of orders Direct labor-hour requirement. Selling price Direct materials cost Direct labor cost The cost of serving customers, $1,608.00 per customer, is the cost of serving a customer for one year. Grennon Corporation buys only one of the company's products. The details of last year's purchases of this product are listed below: 1,500 units 5 batches 2 orders. Activity Rate $ 3.45 per DLH $ 193.30 per batch $83.05 per order. $ 1,608.00 per customer 0.25 DLHS per unit. $ 18.55 per unit $ 8.35 per unit $3.95 per unit. According to the activity-based costing system, the total overhead cost for this customer this past year was closest to:

Delauder Enterprises makes a variety of products that it sells to other businesses. The company's activity-based costing system has four activity cost pools for assigning costs to products and customers. Details concerning that activity-based costing system are listed below: Activity Cost Pool Supporting assembly Processing batches. Processing orders. Serving customers Activity Measure Direct labor-hours (DLHS) Number of batches. Number of orders. Number of customers. Number of units purchased Number of batches. Number of orders Direct labor-hour requirement. Selling price Direct materials cost Direct labor cost The cost of serving customers, $1,608.00 per customer, is the cost of serving a customer for one year. Grennon Corporation buys only one of the company's products. The details of last year's purchases of this product are listed below: 1,500 units 5 batches 2 orders. Activity Rate $ 3.45 per DLH $ 193.30 per batch $83.05 per order. $ 1,608.00 per customer 0.25 DLHS per unit. $ 18.55 per unit $ 8.35 per unit $3.95 per unit. According to the activity-based costing system, the total overhead cost for this customer this past year was closest to:

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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A costing system where all product costs are recorded at standard cost while the products are being made is referred to as A.) standard costing B.) variable costing C.) normal costing D.) full costing
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Activity-based costing can be used to allocate period costs to various products that the company sells. False True
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