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A manufacturer uses activity-based costing to assign overhead cost to products. Budgeted cost information for...

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Accounting

A manufacturer uses activity-based costing to assign overhead cost to products. Budgeted cost information for its activities follows.

ActivityBudgeted CostActivity Cost DriverBudgeted Activity UsagePurchasing$ 675,000Purchase orders22,500purchase ordersFactory services160,000Square feet25,000square feetSetup325,000Setups250Setups

Compute an activity rate for each activity

Select one:

a. Purchasing: $30 per purchase order; Factory services: $6.40 per square foot; Setup: $1,300 per setup.

b. Purchasing: $34 per purchase order; Factory services: $9.10 per square foot; Setup: $1,100 per setup.

c. Purchasing: $32 per purchase order; Factory services: $8.00 per square foot; Setup: $1,440 per setup.

d. Purchasing: $22 per purchase order; Factory services: $7.00 per square foot; Setup: $1,500 per setup.

e. Purchasing: $27 per purchase order; Factory services: $7.20 per square foot; Setup; $1,220 per setup.

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