Dobles Corporation has provided the following data from its activity-based costing system: The company makes 420 units of product D28K a year,requiring a total of 460 machine-hours,80 orders,and 10 inspection-hours per year.The product's direct materials cost is $48.96 per unit and its direct labor cost is $25.36 per unit. According to the activity-based costing system,the unit product cost of product D28K is closest to:
A)$95.34 per unit
B)$93.60 per unit
C)$74.32 per unit
D)$89.93 per unit

Question

Dobles Corporation has provided the following data from its activity-based costing system:  The company makes 420 units of product D28K a year,requiring a total of 460 machine-hours,80 orders,and 10 inspection-hours per year.The product's direct materials cost is $48.96 per unit and its direct labor cost is $25.36 per unit. According to the activity-based costing system,the unit product cost of product D28K is closest to:
A)$95.34 per unit 
B)$93.60 per unit 
C)$74.32 per unit 
D)$89.93 per unit

Quizplus · Accepted Answer

The activity rates for each activity cost pool are computed as follows:
 11eaa3fe_3342_87bd_908b_a5f5731e9acd_TB2461_00 The overhead cost charged to Product D28K is:
 11eaa3fe_3342_aece_908b_91e204c2ca49_TB2461_00 
 11eaa3fe_3342_aecf_908b_85537a1e3d03_TB2461_00 Unit product cost = $40,043.80 ÷ 420 units = $95.34 per unit

Dobles Corporation Has Provided the Following Data from Its Activity-Based