XYZ Co. currently uses traditional costing procedures, applying $800,000 of overhead to products Beta and Zeta on the basis of direct labor hours. The company is considering a shift to activity-based costing and the creation of individual cost pools that will use direct labor hours (DLH), production setups (SU), and number of parts components (PC) as cost drivers. Data on the cost pools and respective driver volumes follow Pool No. 3 (Driver: PC) Pool No. 2 (Driver: SU) Pool No.1(Driver: Product DLH) 2,250 55 1,200 Zeta 750 45 2,800 Beta $360,000 $280,000 $160,000 Pool Cost :The overhead cost allocated to Beta by using activity-based costing procedures would be $356,000 a O $472,000 b O $328,000 c O $444,000 d O e O None of the given answers

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Chapter1: Financial Statements And Business Decisions
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XYZ Co. currently uses traditional costing procedures, applying $800,000 of overhead to products Beta and Zeta on the basis of direct labor hours.
The company is considering a shift to activity-based costing and the creation of individual cost pools that will use direct labor hours (DLH),
production setups (SU), and number of parts components (PC) as cost drivers. Data on the cost pools and respective driver volumes follow
Pool No. 3 (Driver: PC) Pool No. 2 (Driver: SU)
Pool No.1 (Driver:
Product
DLH)
2,250
55
1,200
Zeta
750
45
2,800
Beta
$360,000
$280,000
$160,000
Pool Cost
:The overhead cost allocated to Beta by using activity-based costing procedures would be
$356,000 a O
$472,000 b O
$328,000 .c O
$444,000 d O
None of the given answers e O
Transcribed Image Text:XYZ Co. currently uses traditional costing procedures, applying $800,000 of overhead to products Beta and Zeta on the basis of direct labor hours. The company is considering a shift to activity-based costing and the creation of individual cost pools that will use direct labor hours (DLH), production setups (SU), and number of parts components (PC) as cost drivers. Data on the cost pools and respective driver volumes follow Pool No. 3 (Driver: PC) Pool No. 2 (Driver: SU) Pool No.1 (Driver: Product DLH) 2,250 55 1,200 Zeta 750 45 2,800 Beta $360,000 $280,000 $160,000 Pool Cost :The overhead cost allocated to Beta by using activity-based costing procedures would be $356,000 a O $472,000 b O $328,000 .c O $444,000 d O None of the given answers e O
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