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A company uses activity-based costing to determine the

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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 below.

Budgeted Activity
  Activity Cost Pool Budgeted Cost Product A Product B Product C
  Activity 1 $104,720 6,800 9,800 20,800
  Activity 2 $74,520 7,800 15,800 8,800
  Activity 3 $126,000 3,300 1,800 2,400

 

Which of the following statements is true regarding this company's activity rates?


 The activity rate under the activity-based costing system for Activity 2 is $2.80.

The activity rate under the activity-based costing system for Activity 2 is $16.80.

The activity rate under the activity-based costing system for Activity 2 is $2.30.

The activity rate under the activity-based costing system for Activity 2 is $21.90.

The activity rate under the activity-based costing system for Activity 2 is $3.95.

Reference no: EM13579657

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