Groleau Corporation has an activitybased costing system with three activity cost poolsProcessing, Setting Up and Other. The
company's overhead costs, which consist of factory utilities and indirect labor, are allocated to the cost pools in proportion to the
activity cost pools' consumption of resources. Costs in the Processing cost pool are assigned to products based on machinehours
MHs and costs in the Setting Up cost pool are assigned to products based on the number of batches. Costs in the Other cost pool
are not assigned to products. Data concerning the two products and the company's costs and activitybased costing system appear
below:
Distribution of Resource Consumption Across Activity Cost Pools
Required:
a Assign overhead costs to activity cost pools using activitybased costing.
b Calculate activity rates for each activity cost pool using activitybased costing.
c Determine the amount of overhead cost that would be assigned to each product using activitybased costing.
d Determine the product margins for each product using activitybased costing.
