Tandem Company manufactures two products (D and F). The overhead costs ($89,750) have been divided...
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Accounting
Tandem Company manufactures two products (D and F). The overhead costs ($89,750) have been divided into three cost pools that use the following activity drivers:
Product
Number of Setups
Machine Hours
PackingOrders
D
10
500
75
F
10
2,000
175
Cost per pool
$11,000
$60,000
$18,750
What is the allocation rate per packing order using activity-based costing?
a.$1,875
b.$18,750
c.$75
d.$250
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