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A Company Has Two Products: a and B

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A company has two products: A and B. It uses activity-based costing and has prepared the following analysis showing budgeted cost and activity for each of its three activity cost pools: A company has two products: A and B. It uses activity-based costing and has prepared the following analysis showing budgeted cost and activity for each of its three activity cost pools:   Annual production and sales level of Product A is 34,300 units, and the annual production and sales level of Product B is 69,550 units. What is the approximate overhead cost per unit of Product B under activity-based costing? A)  $3.00 B)  $2.00 C)  $10.28 D)  $15.00 E)  $2.33 Annual production and sales level of Product A is 34,300 units, and the annual production and sales level of Product B is 69,550 units. What is the approximate overhead cost per unit of Product B under activity-based costing?


Definitions:

Profit Incentives

Motivations for individuals or companies to undertake activities that increase their profits.

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An economic system based on private ownership of the means of production and their operation for profit, characterized by a free market and open competition.

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