Meester Corporation Has an Activity-Based Costing System with Three Activity

question 48

Multiple Choice

Meester Corporation has an activity-based costing system with three activity cost pools--Machining, Order Filling, and Other. In the first stage allocations, costs in the two overhead accounts, equipment depreciation and supervisory expense, are allocated to three activity cost pools based on resource consumption. Data used in the first stage allocations follow: Distribution of Resource Consumption Across Activity Cost Pools:
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 for the company's two products follow:
Activity:
What is the overhead cost assigned to Product H2 under activity-based costing?

• A) $24,720
• B) $6,240
• C) $18,480
• D) $52,000

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Definitions:

Mechanics

The branch of physics concerned with the motion of objects and the forces that cause this motion.

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