Wedd Corporation Uses Activity-Based Costing to Assign Overhead Costs to Products

question 33

Multiple Choice

Wedd Corporation uses activity-based costing to assign overhead costs to products. Overhead costs have already been allocated to the company's three activity cost pools as follows: Processing, $27,200; Supervising, $9,300; and Other, $9,500. Processing costs are assigned to products using machine-hours (MHs) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data appear below: What is the overhead cost assigned to Product O6 under activity-based costing?

• A) $2,325
• B) $23,000
• C) $14,837
• D) $12,512

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Definitions:

Acetylcholine

A neurotransmitter and chemical that motor neurons of the nervous system release in order to activate muscles.

Secretion

The process by which substances are produced and discharged from a cell, gland, or organ for a particular function in the organism or for excretion.

Terminal Cisternae

Enlarged areas of the sarcoplasmic reticulum around the myofibrils of muscle cells, involved in calcium ion storage.

T-tubules

Tubular extensions of the plasma membrane that penetrate into the center of skeletal and cardiac muscle cells, facilitating the transmission of electrical impulses.