A company has two products: Big and Little.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 big product is 62,525 units,and the annual production and sales level of little product is 251,900 units.
a.Compute the approximate overhead cost per unit of big product under activity-based costing.
b.Compute the approximate overhead cost per unit of little product under activity-based costing.
Definitions:
Magma Rise
The upward movement of molten rock or magma from the Earth's mantle towards the crust, often leading to volcanic activity.
Pressure Decreases
A phenomenon where the force exerted by a fluid per unit area decreases, commonly observed with increasing altitude in the atmosphere.
Uplifted
The process of raising a part of the earth’s crust by tectonic forces, leading to the formation of mountains and plateaus.
Solidifies
The process of becoming firm or hard, or changing from a liquid or gas to a solid state.
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