To determine the overhead cost assigned to the dessert bar product line using activity-based costing (ABC), follow these steps:
1. Identify Activity Costs and Cost Drivers:
- Extrusion costs: [tex]\( \$637,500 \)[/tex]
- Packaging costs: [tex]\( \$44,000 \)[/tex]
- Cost driver for extrusion costs: Number of batches
- Cost driver for packaging costs: Number of units
2. Summarize Activity Drivers for Each Product Line:
- Ice Cream Sandwiches:
- 350,000 units
- 400 batches
- Dessert Bars:
- 200,000 units
- 350 batches
3. Calculate Total Batches and Units:
- Total batches: [tex]\( 400 \text{ (Ice Cream Sandwiches) } + 350 \text{ (Dessert Bars) } = 750 \text{ batches} \)[/tex]
- Total units: [tex]\( 350,000 \text{ (Ice Cream Sandwiches) } + 200,000 \text{ (Dessert Bars) } = 550,000 \text{ units} \)[/tex]
4. Determine Cost per Batch and Cost per Unit:
- Cost per batch: [tex]\( \frac{\$637,500}{750 \text{ batches}} = \$850 \text{ per batch} \)[/tex]
- Cost per unit: [tex]\( \frac{\$44,000}{550,000 \text{ units}} = \$0.08 \text{ per unit} \)[/tex]
5. Calculate Overhead Cost for Dessert Bars:
- Extrusion cost for dessert bars: [tex]\( 350 \text{ batches} \times \$850 \text{ per batch} = \$297,500 \)[/tex]
- Packaging cost for dessert bars: [tex]\( 200,000 \text{ units} \times \$0.08 \text{ per unit} = \$16,000 \)[/tex]
6. Sum the Overhead Costs for Dessert Bars:
- Total overhead cost for dessert bars: [tex]\( \$297,500 + \$16,000 = \$313,500 \)[/tex]
Therefore, the overhead cost assigned to the dessert bar product line using activity-based costing (ABC) is [tex]\( \$313,500 \)[/tex].
So, the correct answer is:
[tex]\[ \$313,500 \][/tex]
