What are the activity rates for the three activities under activity-based costing?
A company uses activity-based costing to determine the costs of its three products: A, B,
and C. The budgeted cost and activity for each of the company's three activity cost pools are shown in the following table:
A) (1) $2.00; (2) $3.00; (3) $3.50.
B) (1) $3.50; (2) $1.50; (3) $32,80.
C) (1) $3.50; (2) $3.00; (3) $16.00.
D) (1) $2.00; (2) $1.50; (3) $16.00.
E) (1) $2.00; (2) $1.50; (3) $32.80.
D) (1) $2.00; (2) $1.50; (3) $16.00.
Explanation: (1) $70,000/(6,000 + 9,000 + 20,000) = $2.00
(2) $45,000/(7,000 + 15,000 + 8,000) = $1.50
(3) $82,000/(2,500 + 1,000 + 1,625) = $16.00
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