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    Question

    A company manufactures two products, P and Q. The

    overhead costs and related activity drivers are as follows: Activity usage by products: What is the total overhead allocated to Product P using Activity-Based Costing?
    A тВ╣38,000 Correct Answer Incorrect Answer
    B тВ╣70,000 Correct Answer Incorrect Answer
    C тВ╣130,000 Correct Answer Incorrect Answer
    D тВ╣304,000 Correct Answer Incorrect Answer
    E тВ╣508,000 Correct Answer Incorrect Answer

    Solution

    For Product P Setup cost = total setups needed x per set up cost = 20├Ч2,000=40,000 Inspection cost = total inspections needed x per inspection cost =150├Ч200=30,000 Total overhead cost = 40,000 + 30,000 = Rs.70,000

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