H-Technology Products manufactures three types of remote-control devices: Economy, Standard, and Deluxe. The company, which uses activity-based costing, has identified five activities (and related cost drivers). Each activity, its budgeted cost, and related cost driver is identified below. Activity Cost Material handling Material insertion Automated machinery Finishing Units to be Overhead Cost Driver produced Orders to be shipped Number of parts 10 per unit $225,000 Packaging 170,000 $3,880,000 Machine hours per unit Labour hours 12 per unit O $164 O $228 O $141 O $225 2,475,000 840,000 The following information pertains to the three product lines for next year: Economy Standard Deluxe 1 hours Direct 170,000 labour hours Number of parts Number of parts Machine 10,000 5,000 2,000 1,000 500 Orders shipped 15 3 200 25 5 The overhead cost assigned to each unit of Economy under activity-based costing is closest to:

Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter4: Activity-based Costing
Section: Chapter Questions
Problem 12E: Activity cost pools, activity rates, and product costs using activity-based costing Caldwell Home...
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H-Technology Products manufactures three types of remote-control devices: Economy, Standard, and
Deluxe. The company, which uses activity-based costing, has identified five activities (and related cost
drivers). Each activity, its budgeted cost, and related cost driver is identified below.
Activity Cost
Material
handling
Material
insertion
Automated
machinery
Finishing
Units to
be
produced
Orders
to be
shipped
Number
Overhead Cost
Driver
Packaging 170,000
$3,880,000
Number
of parts
Number
of parts
Machine
hours
Direct
170,000 labour
hours
The following information pertains to the three product lines for next year:
Economy Standard Deluxe
Machine
hours
per unit
Labour
hours 112
per unit
O $164
O $228
O $141
O $225
$225,000
2,475,000
of parts 10
per unit
1
840,000
10,000 5,000 2,000
1,000 500
Orders
shipped
15
3
200
25
5
The overhead cost assigned to each unit of Economy under activity-based costing is closest to:
Transcribed Image Text:H-Technology Products manufactures three types of remote-control devices: Economy, Standard, and Deluxe. The company, which uses activity-based costing, has identified five activities (and related cost drivers). Each activity, its budgeted cost, and related cost driver is identified below. Activity Cost Material handling Material insertion Automated machinery Finishing Units to be produced Orders to be shipped Number Overhead Cost Driver Packaging 170,000 $3,880,000 Number of parts Number of parts Machine hours Direct 170,000 labour hours The following information pertains to the three product lines for next year: Economy Standard Deluxe Machine hours per unit Labour hours 112 per unit O $164 O $228 O $141 O $225 $225,000 2,475,000 of parts 10 per unit 1 840,000 10,000 5,000 2,000 1,000 500 Orders shipped 15 3 200 25 5 The overhead cost assigned to each unit of Economy under activity-based costing is closest to:
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