Question

Coastal Bank uses activity-based costing to determine the cost of servicing customers. There are three activity pools: teller transaction processing ($2.80 per teller transaction), check processing ($0.25 per canceled check), and ATM transaction processing ($0.20 per ATM transaction). Jacki Marshall had 4 teller transactions, 12 canceled checks, and 9 ATM transactions during the month. What is the total monthly activity-based cost for Jacki Marshall during the month?a.$16.00b.$116.80c.$43.00d.$14.38

Answer 1

Answer:Allocated MOH= $16

Explanation:

Giving the following information:

teller transaction processing ($2.80 per teller transaction)

check processing ($0.25 per canceled check)

ATM transaction processing ($0.20 per ATM transaction).

To allocate overhead, we need to use the following formula:

Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base

Allocated MOH= 2.8*4 + 0.25*12 + 0.2*9

Allocated MOH= $16