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Angel Corporation Uses Activity-Based Costing to Determine Product Costs for External

question 61

Multiple Choice

Angel Corporation uses activity-based costing to determine product costs for external financial reports. The company has provided the following data concerning its activity-based costing system:
$\begin{array}{lrr} &\text { Estimated } \\ \text {Activity Cost Pools (and Activity Meseasure } & \text {overhead Cost}\\ \text { Machine related (machine-hours) . } &£ 81,600\\ \text { Batch setup (setups) .} &£ 387,000 \\ \text { General factory (direct labour-hours) . } & £ 274,800 \\\end{array}$

$\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\text { Expected Activity }$
$\begin{array}{lrr}\text { Activity Cost Pools }& \text { Total } & \text {Product X}& \text { Product Y}\\ \text {Machine related. } &8,000&3,000&5,000\\ \text { Batch setup. } &10,000&2,000&8,000\\ \text {General factory } &12,000&7,000&5,000\\\end{array}$

Assuming that actual activity turns out to be the same as expected activity, the total amount of overhead cost allocated to Product X would be closest to:

Definitions:

Alchemists

Ancient practitioners who sought to transform base metals into noble metals, such as gold, and to discover a universal cure for disease and a way of extending life.

Lead

A heavy metal element with the symbol Pb, known for its malleability, poor conductivity, and various uses and health impacts.

Gold

A dense, soft, yellow metallic element used widely in jewelry, electronics, and for monetary systems.

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