Lakey Corporation Has an Activity-Based Costing System with Three Activity

question 365

Essay

Lakey Corporation has an activity-based costing system with three activity cost pools--Machining, Setting Up, and Other. The company's overhead costs have already been allocated to the cost pools and total $11,000 for the Machining cost pool, $26,200 for the Setting Up cost pool, and $9,800 for the Other cost pool. Costs in the Machining cost pool are assigned to products based on machine-hours (MHs) and costs in the Setting Up cost pool are assigned to products based on the number of batches. Costs in the Other cost pool are not assigned to products. Data concerning the two products appear below:
Required:a. Calculate activity rates for each activity cost pool using activity-based costing.b. Determine the amount of overhead cost that would be assigned to each product using activity-based costing.

---

Definitions:

Unconditioned Stimulus

In classical conditioning, an unconditioned stimulus is something that naturally and automatically triggers a response without any learning process involved.

Unconditioned Response

An automatic, natural reaction to a stimulus that occurs without prior learning or conditioning.

Counterconditioning

A behavior therapy technique that involves replacing an undesirable response to a stimulus with a more desirable one.

Fear of Dogs

A persistent and intense fear of dogs, often categorized as a specific phobia affecting people.