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

The following units were produced in December with the following information:

Total manufacturing costs for Part 001 is
A)$4,625.
B)$1,500.
C)$7,125.
D)$4,000.

Question

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

The following units were produced in December with the following information:

Total manufacturing costs for Part 001 is
A)$4,625. 
B)$1,500. 
C)$7,125. 
D)$4,000.

Quizplus · Accepted Answer

C)
Materials costs = $2,500
Overhead
Materials 100 moves × $5 = 500
Assembling 200 hours × $5 = 1,000
Packaging 1,250 units × $2.50 = 3,125
Total = $7,125

Beartowne Enterprises Uses an Activity-Based Costing System to Assign Costs