A company has two products: standard and deluxe. The company expects to produce 38,975 standard...
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A company has two products: standard and deluxe. The company expects to produce 38,975 standard units and 64,840 deluxe units. It uses activity-based costing and has prepared the following analysis showing budgeted cost and cost driver activity for each of its three activity cost pools. Activity Cost Pool Activity 1 Activity 2 Activity 3 Budgeted Cost $113,150 $118,000 $102,080 Budgeted Activity of Cost Driver Standard Deluxe 2,500 5,250 4,500 5,500 3,000 2,800 Required: 1. Compute overhead rates for each of the three activities. 2. What is the expected overhead cost per unit for the standard units? 3. What is the expected overhead cost per unit for the deluxe units? (Round activity rate and cost per unit answers to 2 decimal places.) Activity Expected Costs Expected Activity Driver Activity Rate 1 $ 113,150 118,000 2 3 102,080 Standard Activity Driver Activity Rate Allocated Cost Activity 1 2 3 Deluxe Activity Driver Activity Rate Allocated Cost Activity 1 2 3
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