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

question 172

Multiple Choice

Sorice 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, $20,200; Supervising, $11,000; and Other, $66,800. 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: The activity rate for the Supervising activity cost pool under activity-based costing is closest to:

• A) $7.50 per batch
• B) $6.00 per batch
• C) $11.00 per batch
• D) $98.00 per batch

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Definitions:

Productive

Having the capability or efficiency to produce a significant quantity of output, results, or progress.

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A device used to record the electrical activity of the brain, often used in the diagnosis of neurological conditions and the study of brain function.

Delta Waves

Slow, high-amplitude brainwaves associated with the deepest stages of sleep and relaxation, playing a role in brain health and functioning.

Sleep Lab

A sleep lab is a facility equipped for observing and recording a person's sleep patterns to diagnose sleep disorders.