Question

Martinez Company has three cost pools and two doggie products (leashes and collars). The activity cost pool of ordering has the cost driver of purchase orders. The activity cost pool of assembly has a cost driver of parts. The activity cost pool of supervising has the cost driver of labor hours. The accumulated data relative to those cost drivers is as follows: Cost Drivers Total Expected Estimated Leashes Collars Cost Drivers Overhead Purchase Orders 130,000 orders $260,000 70,000 60,000 Parts 800,000 parts 400,000 300,000 500,000 Labor Hours 25,000 hours 300,000 15,000 10,000 $960,000The costs assigned to leashes for supervising are:_______.a. $90.000b. $180.000c. $120.000d. $60.000

Answer 1

Answer:

The cost assigned to leashes for supervising is $180,000

Explanation:

Estimated Overhead Cost Drivers Overhead Rates

$ 260,000.00          130,000         $ 2.00 Per Order

$ 400,000.00          800,000 $ 0.50 per Part

$ 300,000.00          25,000         $ 12.00 Per Hour

Labor hours for the leashes is 15,000 hours

Cost assigned to leashes for supervising = 15,000 x 12 = $180,000