Accounting 26th Edition by Carl Warren ,Jim Reeve ,Jonathan Duchac

Exercise 41

Activity rates and product costs using activity-based costing
BriteLite Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and their associated activity costs and activity bases are as follows:

Corporate records were obtained to estimate the amount of activity to be used by the two products. The estimated activity-base usage quantities and units produced for each product and in total are provided in the following table:

a. Determine the activity rate for each activity.
b. Use the activity rates in (a) to determine the total and per-unit activity costs associated with each product.