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

question 180

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, $49,800; Supervising, $27,500; and Other, $24,900. 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? (Round your intermediate calculations to 2 decimal places.)

• A) $64,949.00
• B) $49,481.00
• C) $17,941.00
• D) $47,008.00

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Definitions:

Financial Statement Analysts

Professionals who examine financial statements to assess the financial health, performance, and future prospects of an entity.

Earnings Management

The use of accounting techniques to produce financial reports that may paint a more favorable picture of a company's business activities and financial position than the actual situation.

Straight-Line Depreciation

A strategy for dividing the cost of a tangible asset over its operational life in equal yearly sums.

Average Net Property

This term typically refers to the average value of a company's property, plant, and equipment net of depreciation, over a certain period of time.