Handal Corporation uses activity-based costing to compute product margins. Overhead costs have already been allocated...
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Accounting
Handal Corporation uses activity-based costing to compute product margins. Overhead costs have already been allocated to the company's three activity cost pools--Machining, Order Filling, and Other. The costs in those activity cost pools appear below:
Machining
$
6,649
Order Filling
$
17,440
Other
$
5,800
Machining costs are assigned to products using machine-hours (MHs) and Order Filling costs are assigned to products using the number of orders. The costs in the Other activity cost pool are not assigned to products. Activity data appear below:
MHs (Machining)
Orders (Order Filling)
Product O4
2,200
130
Product S1
8,700
960
Finally, sales and direct cost data are combined with Machining and Order Filling costs to determine product margins.
Product O4
Product S1
Sales (total)
$
70,100
$
76,600
Direct materials (total)
$
31,800
$
21,000
Direct labor (total)
$
30,600
$
31,700
What is the overhead cost assigned to Product S1 under activity-based costing?
Multiple Choice
$13,800
$5,307
$15,360
$20,667
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