A company incurs $1210000 of overhead each year in three departments, Processing, Packaging, and Testing. The...

 

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A company incurs $1210000 of overhead each year in three departments, Processing, Packaging, and Testing. The company performs 1000 processing transactions, 200000 packaging transactions, and 1900 tests per year in producing 393000 drums of oil and 602000 drums of sludge. The following data are available: Department Use of Cost Driver Cost Processing 1000 $510000 Packaging 200000 510000 Testing 1900 190000 Production information for sludge is as follows: Department Use of Cost Driver Processing 500 Packaging 92000 Testing 600 Calculate the amount of overhead assigned to sludge. A company incurs $1210000 of overhead each year in three departments, Processing, Packaging, and Testing. The company performs 1000 processing transactions, 200000 packaging transactions, and 1900 tests per year in producing 393000 drums of oil and 602000 drums of sludge. The following data are available: Department Use of Cost Driver Cost Processing 1000 $510000 Packaging 200000 510000 Testing 1900 190000 Production information for sludge is as follows: Department Use of Cost Driver Processing 500 Packaging 92000 Testing 600 Calculate the amount of overhead assigned to sludge.

Answer rating: 100% (QA)

Answer The overhead assigned to sludge can be calculated using ActivityBased Costing ABC Heres how O... View the full answer