Correct answer-------The activity rate under the
activity-based costing system for Activity 2 is $1.50.
Working
|
Calculation of Activity rates |
|
Activity Cost Pool |
Activity driver |
Overhead Cost |
Expected Activity (B) |
Activity rate (A/B) |
|
Activity 1 |
Number of Activity |
$ 70,000.00 |
35,000 |
$
2.00 |
Per Activity |
|
Activity 2 |
Number of Activity |
$
45,000.00 |
30000 |
$
1.50 |
Per Activity |
|
Activity 3 |
Number of Activity |
$ 82,000.00 |
5125 |
$ 16.00 |
Per Activity |
As it can be seen $16 per activity is rate for Activity 3 not 2
and $ 2 is rate for activity 1.
