Nick Company has two products: A and B. The company uses activity-based costing. The estimated total cost and expected activity for each of the company's three activity cost pools are as follows:
Expected Activity
Activity Cost Pool Estimated Costs Product A Product B Total
Activity 1 $32,600 700 300 1,000Activity 2$17,600600 200 800Activity 3 $52,500 400100500
The activity rate under the activity-based costing system for Activity 3 is closest to:
Answer
a. $44.65
b. $105.00
c. $525.00
d. $205.00
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