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Daniele Corporation uses an
activity-based costing system with the following three activity cost pools:
|
Activity
Cost Pool
|
Total
Activity
|
|
Fabrication
|
50,000 machine-hours
|
|
Order processing
|
500 orders
|
|
Other
|
not applicable
|
The Other activity cost pool is used
to accumulate costs of idle capacity and organization-sustaining costs.
The company has provided the
following data concerning its costs:
|
Cost Data
|
|
Wages and salaries
|
$280,000
|
|
Depreciation
|
$200,000
|
|
Occupancy
|
$140,000
|
|
Total
|
$620,000
|
The distribution of resource
consumption across activity cost pools is given below:
|
Activity Cost Pools
|
|
Fabrication
|
Order
Processing
|
Other
|
Total
|
|
Wages and salaries
|
60%
|
30%
|
10%
|
100%
|
|
Depreciation
|
20%
|
35%
|
45%
|
100%
|
|
Occupancy
|
10%
|
50%
|
40%
|
100%
|
The activity rate for the
Fabrication activity cost pool is closest to _______ per machine hour.
