Mirabile Corporation uses activity-based costing to compute product margins. Overhead costs have already been allocated to the company's three activity cost pools- Processing, Supervising, and Other. The costs in those activity cost pools appear below: Processing $ 3,800 $ 23,800 $ 10,400 Supervising Other 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 appear below: Batches MHS (Processing) (Supervising) Product Me 9,700 500 Product M5 300 500 Total 10,000 1,000 Finally, sales and direct cost data are combined with Processing and Supervising costs to determine product margins. Product MO Product M5 Sales (total) Direct materials (total) Direct labor (total) $ 74,100 $ 28,500 $ 27,800 $ 89,900 $ 31,400 $ 41,700 What is the product margin for Product M5 under activity-based costing?
Mirabile Corporation uses activity-based costing to compute product margins. Overhead costs have already been allocated to the company's three activity cost pools- Processing, Supervising, and Other. The costs in those activity cost pools appear below: Processing $ 3,800 $ 23,800 $ 10,400 Supervising Other 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 appear below: Batches MHS (Processing) (Supervising) Product Me 9,700 500 Product M5 300 500 Total 10,000 1,000 Finally, sales and direct cost data are combined with Processing and Supervising costs to determine product margins. Product MO Product M5 Sales (total) Direct materials (total) Direct labor (total) $ 74,100 $ 28,500 $ 27,800 $ 89,900 $ 31,400 $ 41,700 What is the product margin for Product M5 under activity-based costing?
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter4: Activity-based Costing
Section: Chapter Questions
Problem 3PA: Activity-based and department rate product costing and product cost distortions Black and Blue...
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