Stanley Corp. manufactures two models of its roasting pans, a standard and a deluxe model. Three activities have been identified as cost drivers and the related costs pooled together to arrive at the following information:

-If activity-based costing is used, then the total cost of the components used in the deluxe model would be
A) $3,455.
B) $27,636.
C) $48,364.
D) $76,000.

Question

Stanley Corp. manufactures two models of its roasting pans, a standard and a deluxe model. Three activities have been identified as cost drivers and the related costs pooled together to arrive at the following information:
 
-If activity-based costing is used, then the total cost of the components used in the deluxe model would be
A) $3,455. 
B) $27,636. 
C) $48,364. 
D) $76,000.

Quizplus · Accepted Answer

Activity-based costing assigns costs based on actual activities and resources used. The total cost of the components in the deluxe model would be calculated based on the specific activities and resources consumed, which is $48,364.