Ivanhoe Company produces two products: Standard and Deluxe. The company uses an activity-based costing system. Ivanhoe produced 8400 units of Standard and 2400 units of Deluxe. The company uses two activity cost pools, with estimated total cost and activity as follows: Expected Activity Activity Cost Pool Estimated Cost Standard Deluxe #1 $12400 540 290 #2 $24400 440 1240 What is the cost per unit of Standard under activity-based costing? $14.52 $7.50 $1.72 $14.94
Ivanhoe Company produces two products: Standard and Deluxe. The company uses an activity-based costing system. Ivanhoe produced 8400 units of Standard and 2400 units of Deluxe. The company uses two activity cost pools, with estimated total cost and activity as follows: Expected Activity Activity Cost Pool Estimated Cost Standard Deluxe #1 $12400 540 290 #2 $24400 440 1240 What is the cost per unit of Standard under activity-based costing? $14.52 $7.50 $1.72 $14.94
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Ivanhoe Company produces two products: Standard and Deluxe. The company uses an activity-based costing system. Ivanhoe produced 8400 units of Standard and 2400 units of Deluxe. The company uses two activity cost pools, with estimated total cost and activity as follows:
| Expected Activity | |||||
|---|---|---|---|---|---|
|
Activity Cost Pool
|
Estimated Cost
|
Standard
|
Deluxe
|
||
|
#1
|
$12400 | 540 | 290 | ||
|
#2
|
$24400 | 440 | 1240 |
What is the cost per unit of Standard under activity-based costing?
$14.52
$7.50
$1.72
$14.94
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