Tandem Company Manufactures Two Products (D and F) What Is the Allocation Rate Per Setup Using Activity-Based Costing

question 194

Multiple Choice

Tandem Company manufactures two products (D and F) . The overhead costs ($84,000) have been divided into three cost pools that use the following activity drivers: $\begin{array}{cccc}\text { Product } & \text { Number of Setups} & \text { Machine Hours} & \text { Packing Orders }\\\hline \mathrm{D} & 10 & 500 & 75 \\\text { F } & 10 & 2,000 & 175 \\\text { Cost perpool } & \$ 11,000 & \$ 60,000 & \$ 18,750\end{array}$ What is the allocation rate per setup using activity-based costing?

• A)$ 550
• B)$1,100
• C)$11,000
• D)$2,200

---

Definitions:

Proximal

Situated close to the origin or point of attachment or reference.

Anterior

Anatomical term meaning toward the front of the body; also called ventral.

Frontal

Anatomical term that refers to the plane that divides the body into anterior and posterior portions. Also called coronal.

Sagittal

An anatomical term that refers to the plane that divides the body into left and right portions.