A Company Has Two Products: AA and BB

Essay

A company has two products: AA and BB.It uses a plantwide overhead allocation method based on activity 33 and has prepared the following analysis showing budgeted costs and activities.Use this information to compute the company's plantwide overhead rate.
$\begin{array}{r}\text { Budgeted Activity }\quad\quad\quad\\\begin{array} { | l | c | r | r | r | } \hline & & { } \\ { \text { Activity Cost Pool } } & { \begin{array} { c } \text { Budgeted } \\\text { Overhead Cost }\end{array} } & \text { Product AA } & \text { Product BB } & { \text { Total } } \\\hline \text { Activity } 11 & \$ 40,000 & 100 & 400 & 500 \\\hline \text { Activity 22 } & \$ 55,000 & 500 & 250 & 750 \\\hline \text { Activity 33 } & \$ 90,000 & 300 & 1,700 & 2,000 \\\hline & & { } \\\hline \begin{array} { l } \text { Total budgeted } \\\text { overhead }\end{array} & \$ 185,000 & { } \\\hline\end{array}\end{array}$