WXY Services Ltd.Scenario: Analyze Cost Allocation using ABCData:Cost Pools and Cost Drivers:Activity 1: $50,000, Cost Driver...
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Accounting
WXY Services Ltd.
Scenario: Analyze Cost Allocation using ABC
Data:
- Cost Pools and Cost Drivers:
- Activity 1: $50,000, Cost Driver Units: 5,000
- Activity 2: $80,000, Cost Driver Units: 8,000
- Activity 3: $30,000, Cost Driver Units: 3,000
Requirements:
- Allocate costs to products A, B, and C based on activity-based costing.
- Calculate the overhead rate for each activity.
- Analyze the cost allocation and its impact on product profitability.
- Discuss the benefits of using ABC for cost management.
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