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

question 219

Multiple Choice

Reck 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: Machining, $11,700; Order Filling, $17,800; and Other, $13,500. 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 appear below: The activity rate for the Order Filling activity cost pool under activity-based costing is closest to:

• A) $43.00 per order
• B) $7.50 per order
• C) $6.00 per order
• D) $17.80 per order

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Definitions:

Recommend

To suggest or advise that someone or something would be good or suitable for a particular purpose or situation.

Buffer

A temporary holding area in computer memory allowing different devices or programs to operate at different speeds or to manage data transfer efficiently.

Neutral Statement

An unbiased and impartial sentence or declaration that does not show any preference for or against any subject or argument.

Delay The Negative

A communication strategy where negative information or feedback is postponed to avoid immediate conflict or discomfort.