Mirkle Corporation Uses the Following Activity Rates from Its Activity-Based

question 42

Multiple Choice

Mirkle Corporation uses the following activity rates from its activity-based costing to assign overhead costs to products: $\begin{array}{llr}\text { Activity Cost Pools }&\text { Activity Rate }\\\text { Assembling products } & \$ 6.56 \text { per assembly hour } \\\text { Processing customer orders } & \$ 65.38 \text { per customer order } \\\text { Setting up batches } & \$ 82.84 \text { per batch }\end{array}$

Data for one of the company's products follow:

$\begin{array} { l l l } & & \text { Product P59G } \\ \text { Number of assembly hours } & 240 & \\ \text { Number of customer orders } & 48 & \\ \text { Number of batches } & 64 \end{array}$
- The company produced 4,000 units of product during the period. Direct materials cost $7.30 per unit and direct labor cost $5.45 per unit. What is the cost per unit of Product P59G using the
Activity-based costing system?

• A) $167.53
• B) $12.75
• C) $9.80
• D) $15.25
• E) $2.50

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Definitions:

Foreign Purchases

The buying of goods or services from another country, contributing to imports in the purchasing country's economy.

Current Account

A component of a country's balance of payments, reflecting the difference between its export and import of goods and services.

Account Surplus

A situation where the income or revenue in an account exceeds the expenditures or costs.

International Trade

The exchange of goods, services, and capital across international borders, driven by the concept of comparative advantage and differing resource endowments.