Chapter 4, Problem 5E

Assigning Overhead to Products in ABC L04−2, L04−3
Sultan Company uses an activity-based costing system.
At the beginning of the year, the company made the following estimates of cost and activity for its five activity cost pools:

Required:
1. Compute the activity rate for each of the activity cost pools.
2. The expected activity for the year was distributed among the company’s four products as follows:

Using the ABC data, determine the total amount of overhead cost assigned to each product.