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Starbright manufactures children car seats,strollers,and baby swings.Starbright's manufacturing costs are budgeted as follows:
Factory utilities $105,000
Factory foremen salaries $75,000
Machinery setup costs $30,000
Total manufacturing overhead $210,000
The company uses activity-based costing to allocate its manufacturing overhead costs to products based on the following schedule:
During the current month,the following levels of activities were incurred:

-What are the total manufacturing overhead costs allocated to the Strollers for the current month? (Do not round intermediate calculations.Round your answer to the nearest dollar. )
A)$69,837
B)$102,873
C)$37,290
D)$210,000

Question

[The following information applies to the questions displayed below.]
Starbright manufactures children car seats,strollers,and baby swings.Starbright's manufacturing costs are budgeted as follows:
Factory utilities $105,000
Factory foremen salaries $75,000
Machinery setup costs $30,000
Total manufacturing overhead $210,000
The company uses activity-based costing to allocate its manufacturing overhead costs to products based on the following schedule:
  During the current month,the following levels of activities were incurred:
 
-What are the total manufacturing overhead costs allocated to the Strollers for the current month? (Do not round intermediate calculations.Round your answer to the nearest dollar. )
A)$69,837 
B)$102,873 
C)$37,290 
D)$210,000

Quizplus · Accepted Answer

We can calculate the allocation rate for each activity by dividing the total cost of the activity by the total activity level:
- Activity 1: $45,000 / 900 = $50
- Activity 2: $75,000 / 6,000 = $12.50
- Activity 3: $90,000 / 3,000 = $30
Then, we can allocate the manufacturing overhead costs to each product:
- Car seats: ($50 × 1,000) + ($12.50 × 5,000) + ($30 × 1,500) = $105,000 allocated
- Strollers: ($50 × 2,000) + ($12.50 × 3,000) + ($30 × 500) = $102,875 allocated
- Baby swings: ($50 × 1,500) + ($12.50 × 2,000) + ($30 × 2,000) = $102,500 allocated
Therefore, the total manufacturing overhead costs allocated to the Strollers for the current month is $102,875, which is closest to option B ($102,873).

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