Spendlove Corporation has provided the following data from its activity-based costing system: The company makes 430 units of product S78N a year,requiring a total of 1,120 machine-hours,40 orders,and 30 inspection-hours per year.The product's direct materials cost is $49.81 per unit and its direct labor cost is $12.34 per unit.The product sells for $129.90 per unit. According to the activity-based costing system,the product margin for product S78N is:
A)$4,116.50
B)$29,132.50
C)$6,180.50
D)$5,161.30

Question

Spendlove Corporation has provided the following data from its activity-based costing system:  The company makes 430 units of product S78N a year,requiring a total of 1,120 machine-hours,40 orders,and 30 inspection-hours per year.The product's direct materials cost is $49.81 per unit and its direct labor cost is $12.34 per unit.The product sells for $129.90 per unit. According to the activity-based costing system,the product margin for product S78N is:
A)$4,116.50 
B)$29,132.50 
C)$6,180.50 
D)$5,161.30

Quizplus · Accepted Answer

The activity rates for each activity cost pool are computed as follows:
 11eaa48f_7b8e_1914_9e4a_c97b0bad2d6e_TB2485_00 The overhead cost charged to Product S78N is:
 11eaa48f_7b8e_1915_9e4a_1d28794da8ba_TB2485_00 
 11eaa48f_7b8e_1916_9e4a_59f4d2eb4b15_TB2485_00

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