Discuss activity minus-based costing system

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Beartowne Enterprises uses an activityminus-based costing system to assign costs in its autominus-parts division.

Activity Est. Indirect Activity Costs Allocation base Cost allocation rate
Materials $60,000 Material moves $5.00/move
Assembling $175,000 Direct labor hours $5.00/dir. labor hour
Packaging $70,000 # of finished units $2.50/finished unit

The following units were produced in December with the followinginformation:

Part # # Produced Materials Costs # Moves Dir. Labor Hours.
Part 001 1,250  $2,500 100 200
Part 002 3,500  $6,000 500 300
Part 003 3,750  $7,000 2,500 1,250

Total manufacturing costs for Part 003 is

A. $35,125.

B. $25,750.

C. $18,750.

D. $28,125.

Reference no: EM131812683

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