A Company Uses Activity-Based Costing to Determine the Costs of Its

question 200

Multiple Choice

A company uses activity-based costing to determine the costs of its three products: A, B, and C. The budgeted cost and activity for each of the company's three activity cost pools are shown in the following table: How much overhead will be assigned to Product B using activity-based costing?

• A) $56,500
• B) $78,000
• C) $62,500
• D) $197,000
• E) $70,000

---

Definitions:

Heuristic

A mental shortcut that allows people to solve problems and make judgments quickly but can sometimes lead to errors in thinking.

Acrostic

A poem, word puzzle, or other composition in which certain letters in each line form a word or words.

Classical Conditioning

A learning process that occurs through associations between an environmental stimulus and a naturally occurring stimulus, leading to a learned response.

Reward

A benefit or positive reinforcement given for a desired behavior, encouraging the behavior to occur again.