Matt Company uses activity-based costing. The company has two products: A and B.
ID: 2477425 • Letter: M
Question
Matt Company uses activity-based costing. The company has two products: A and B. The annual production and sales of Product A is 7,000 units and of Product B is 5,500 units. There are three activity cost pools, with total cost and total activity as follows:
Total Activity
The activity-based costing cost per unit of Product A is closest to: (Round your intermediate calculations to 2 decimal places.)
$7.09 per units
$11.49 per units
$9.19 per units
$15.14 per units
Matt Company uses activity-based costing. The company has two products: A and B. The annual production and sales of Product A is 7,000 units and of Product B is 5,500 units. There are three activity cost pools, with total cost and total activity as follows:
Explanation / Answer
Calculation of the activity based costing cost per unit for product A Activity 1 9435 (38295*170/690) Activity 2 45477 (61125*930/1250) Activity 3 25520 (123540*880/4260) Total Cost 80432 No of units 7000 Cost per unit 11.49029 (80432/7000) activity based costing cost per unit for product A is $ 11.49 The correct option is B. $ 11.49 per units .