Use the following to answer questions:
Abel Company uses activity-based costing. The company has two products: A and B. The annual production and sales of Product A is 200 units and of Product B is 400 units. There are three activity cost pools, with estimated costs and expected activity as follows:
|
|
|
|
Expected Activity
|
|
|
Activity Cost Pool
|
Estimated Cost
|
Product A
|
Product B
|
Total
|
|
|
Activity 1...............
|
$16,660
|
600
|
100
|
700
|
|
|
Activity 2...............
|
$18,450
|
1,100
|
700
|
1,800
|
|
|
Activity 3...............
|
$9,731
|
60
|
160
|
220
|
1. The activity rate for Activity 2 is closest to:
A) $24.91
B) $26.36
C) $16.77
D) $10.25
2. The cost per unit of Product B is closest to:
A) $41.58
B) $81.53
C) $74.73
D) $17.69