Duquesne Incorporated Recently Implemented an Activity-Based Costing System

question 13

Essay

Duquesne Incorporated recently implemented an activity-based costing system.Total results from all products manufactured in the current year are:
Duquesne manufactures sprinkler heads for commercial applications.Annual production and sales of one of its heads,is 2,300.The following relates to the most recent year.
Required:
1.Calculate the activity cost pool rates for each of the three activity cost pools listed.
2.Calculate the average cost of one sprinkler head.

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Definitions:

Indirect

In a manner or by means not directly explicit; involving an intermediary or secondary channel.

Direct

The process or manner of communication or transaction that happens without any intermediaries.

Channel Conflict

A situation where channels in a distribution chain are in competition with each other or interfere, leading to reduced efficiency or sales.

Vertical

An industry or market in which businesses provide products or services specific to a particular niche, focusing on a tightly defined area of operation.