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Question
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 companys three activity cost pools are shown below.
| Budgeted Activity | ||||
| Activity Cost Pool | Budgeted Cost | Product A | Product B | Product C |
| Activity 1 | $140,000 | 7,500 | 4,000 | 6,000 |
| Activity 2 | $54,000 | 2,500 | 2,000 | 1,500 |
| Activity 3 | $28,000 | 15,000 | 25,000 | 30,000 |
Compute the companys activity rates under activity-based costing for each of the three activities.
Answer
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