Reference: 05-08
Albin Company Uses Activity-Based Costing to Compute Product

Reference: 05-08
Albin Company uses activity-based costing to compute product costs for external reports. The company has three activity cost pools and applies overhead using predetermined overhead rates for each activity cost pool. Estimated costs and activities for the current year are presented below for the three activity cost pools: $$\begin{array}{l}\begin{array} { | l | l | l | } \hline & \text { Estimated Overhead Cost } & \text { Expected Activity } \\\hline \text { Activity 1 } & \$ 42,700 & 2,000 \\\hline \text { Activity 2 } & \$ 24,934 & 2,600 \\\hline \text { Activity 3 } & \$ 49,289 & 2,300 \\\hline\end{array}\\\text { Actual costs and activities for the current year were as follows: }\\\begin{array} { | l | l | l | } \hline & \text { Actual Overhead Cost } & \text { Actual Activity } \\\hline \text { Activity } 1 & \$ 42,855 & 1,995 \\\hline \text { Activity } 2 & \$ 24,794 & 2,595 \\\hline \text { Activity 3 } & \$ 49,294 & 2,295 \\\hline\end{array}\end{array}$$
-The total debits to the Manufacturing Overhead account during the year were closest to:

A) $116,923.
B) $116,943.
C) $116,661.
D) $120,133.

Correct Answer:

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