Computing Product Costs Using ActivityBased Costing. Ralston Company identified the following activities, estimated costs for each activity, and identified cost drivers for each activity for this coming year. These are the first three steps of activitybased costing.
Activity
Production setup
Materials handling
Quality control
Total
Estimated Annual Overhead Costs
Estimated Annual
Cost Driver Activity
production runs
yards purchased
inspections
The company produces two products, MX and MX Information about these products for the month of July follows:
Direct materials cost per unit
Direct labor cost per unit
Overhead cost per unit
Product cost per unit
Units produced
Number of production runs
Yards of material purchased
Number of inspections
tableMXDirect materials cost per unit,$$Direct labor cost per unit,,Overhead cost per unit,,?,,?
