Managerial accounting-activity rate

Assignment Help Managerial Accounting

Reference no: EM1350451

Laguna Corporation has provided the following data concerning its overhead costs for the coming year:

Wages and salaries 260,000
Depreciation 100,000
Rent 180,000
Total 540,000

The company has an activity-based costing system with the following three activity cost pools and estimated activity for the coming year:

Activity Cost Pool Total Activity
Assembly 50,000 labor-hours
Order processing 400 orders
Other Not applicable

The Other activity cost pool does not have a measure of activity; it is used to accumulate costs of idle capacity and organization-sustaining costs.

The distribution of resource consumption across activity cost pools is given below:

Activity Cost Pools
Assembly Order Processing Other Total
Wages and salaries 60% 20% 20% 100%
Depreciation 5% 60% 35% 100%
Rent 30% 30% 40% 100%

The activity rate for the Order Processing activity cost pool is closest to:

405 per order
270 per order
415 per order
495 per order

Reference no: EM1350451

Questions Cloud

Determine the risk involved with each plan : DeSoto Tools, Corporation is considering to expand production. The expansion will cost $300,000, which can be financed either by bonds at an interest rate of 14% or through selling 10,000 shares of common stock at $30 per share.

Question on job-order costing system : Leija Manufacturing Company uses a job-order costing system and started the month of March with one job in process (Job #359). This job had $500 of cost assigned to it at this time. During March, Leija assigned production costs as follows to the j..

Define and explain the roles of the primary and secondary : Define and explain the roles of the primary and secondary facilitator and Why is it important to switch hats when in one of these roles?

Emerging market is using internet phone to replace pbx : Interesting emerging market is using Internet phone and company's high speed LAN to replace same company's PBX. Write a one page report on this issue.

Managerial accounting-activity rate : Laguna Corporation has provided the following data concerning its overhead costs for the coming year:The Other activity cost pool does not have a measure of activity; it is used to accumulate costs of idle capacity and organization-sustaining cost..

Derive from first principles equilibrium level of income : Derive, from first principles, the equilibrium level of income. Derive the Keynesian expenditure multiplier. If T = tY, derive the equilibrium level of income.

Discuss the objectives of student loans : I am conducting a detail study on the advantage and disadvantages of university students using student loans. Explain and discuss the objectives of student loans?

Cost allocation for kleyman company : The controller of Kleyman Company estimates the amount of materials handling overhead cost that should be allocated to the company's two products using the data that are given below:

Compute confidence intervals for the population proportion : Compute confidence intervals for the population proportion

User Account

All Pages