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Chrzan inc manufactures and sells two products product ro and product no data concerning the expected production of each product and the expected total direct labor hours dlhs required to produce that out put appear below

Sagot :

anthougo

The activity rate for the Order Size activity cost pool under activity-based costing is closest to A. $59.78 per MH.

What is the activity rate under activity-based costing?

The activity rate under activity-based costing is also called the cost driver rate.

The activity rate per cool pool can be computed by dividing the cost pool total cost by the cost driver total requirements.

Data and Calculations:

Order size Overhead Costs = $579,866

Machine Hours (MHs) = 9,700

Activity rate for the Order Size = $59.78 ($579,866/9,700)

Thus, the activity rate for the Order Size activity cost pool under activity-based costing for Chrzan Inc. is closest to A. $59.78 per MH.

Learn more about activity-based costing at https://brainly.com/question/6654166

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Question Completion with Answer Options:

                     Expected      Direct Labor-        Total Direct

                   Production   Hours Per Unit      Labor-Hours

Product E0        300                  9.0                      2,700

Product N0     1,000                  8.0                     8,000

Total direct labor hours                                      10,700

The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity:

                                                        Estimated      

Activity Cost  Pool     Activity         Overhead      Expected Activity      Total

                                 Measures          Costs     Product E0  Product N0

Labor-related             DLHs        $ 296,390        2,700       8,000     10,700

Production orders     orders            55,587           300           400         700

Order size                  MHs            579,866        5,000        4,700      9,700

                                                    $ 931,843

The activity rate for the Order Size activity cost pool under activity-based costing is closest to:_________-.

A. $59.78 per MH

B. $87.09 per MH

C. $44.16 per MH

D. $37.05 per MH

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