Accola Company uses activity-based costing. The company has two products: A and B. The annual production and sales of Product A is 1,100 units and of Product B is 700 units. There are three activity cost pools, with estimated costs and expected activity as follows:

-The cost per unit of Product A is closest to:
A) $59.23
B) $57.20
C) $47.89
D) $22.70

Question

Accola Company uses activity-based costing. The company has two products: A and B. The annual production and sales of Product A is 1,100 units and of Product B is 700 units. There are three activity cost pools, with estimated costs and expected activity as follows:

-The cost per unit of Product A is closest to:

-The cost per unit of Product A is closest to:
A) $59.23 
B) $57.20 
C) $47.89 
D) $22.70

Quizplus · Accepted Answer

The cost per unit of Product A is closest to $59.23, as it is the highest value among the given options, suggesting it is the most accurate estimate.

Accola Company Uses Activity-Based Costing