Anola Company Has Two Products: a AndB The Activity Rate Under the Activity-Based Costing System for Activity

question 28

Multiple Choice

Anola Company has two products: A andB. The company uses activity-based costing. The estimated total cost and expected activity for each of the company's three activity cost pools are as follows: $\begin{array}{lrr}&\text { Estimated}& \text {Expected Activity }\\\text { Activity CostPool }&\text { Cost }& \text {ProductA}&\text { Product B}&\text { Total }\\ \text {Activity 1 } &£ 18,000&300 &200 &500\\\\ \text { Activity 2. } &£ 16,000& 500 & 100 &600\\\\ \text { Activity 3 } &£ 27,000& 600 &300 & 900\\\end{array}$

The activity rate under the activity-based costing system for Activity 3 is closest to

• A)£30.00.
• B)£30.50.
• C)£90.00.
• D)£67.78.

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Definitions:

Predictive Validity

The degree to which one measure can be used to predict another.

Reputation

The public perception or the general opinion about a person, organization, or thing, based on their actions, character, or achievements.

Self-Concept

A person’s knowledge and opinions about herself.

Realistic Accuracy Model

A framework for understanding how people can make accurate judgments of others' personalities.