Roshannon Corporation Uses Activity-Based Costing to Compute Product Margins

question 36

Multiple Choice

Roshannon Corporation uses activity-based costing to compute product margins. In the first stage, the activity-based costing system allocates two overhead accounts-equipment expense and indirect labor-to three activity cost pools-Processing, Supervising, and Other-based on resource consumption. Data to perform these allocations appear below: In the second stage, Processing costs are assigned to products using machine-hours (MHs) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow: Finally, sales and direct cost data are combined with Processing and Supervising costs to determine product margins.
-What is the product margin for Product P3 under activity-based costing?

• A)-$15,600
• B)$2,844
• C)$14,400
• D)$8,484

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Definitions:

Intravenous

Administered within or into a vein.

Intravenous

Refers to the administration of medicines, fluids, nutrients, or other substances directly into a vein.

Intrathecal

Pertaining to an injection into the space under the arachnoid membrane of the brain or spinal cord.

Intramuscular

Related to the administration of medication directly into the muscle tissue through injection.