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What is product margin for product under activity-based cost

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Reference no: EM131791826

Problem

That Other Corporation uses activity-based costing to compute product margins. Overhead costs have already been allocated to the company's three activity cost pools-Processing, Supervising, and Other. The costs in those activity cost pools appear below:

processing      $4600

supervising     $16500

other                $14900

Processing costs are assigned to products using machine-hours (MHs) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data appear below:

                                 MH (Processing)            Batches(supervising) 

product Q7                          4700                           100

Product U8                          5300                           900

total                                   10000                         1000

Finally, sales and direct cost data are combined with Processing and Supervising costs to determine product margins.

                                            Product Q7             Product U8

Sales (total)                           $82100                  90700

direct materials (total)             $48,600                 48300

direct labor (total)                  $25,900                  21200

What is the product margin for Product Q7 under activity-based costing?

Reference no: EM131791826

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