Haridan Co. uses activity-based costing. The company has two products, A and B. The annual production and sales of Products A and B are 8,000 units and 6,000 units, respectively. There are three activity cost pools, with estimated total cost and expected activity as follows:
|
Expected Activity |
||||
|
Activity Cost Pool |
Estimated Cost |
Product A |
Product B |
Total |
|
Activity 1 |
$20,000 |
100 |
400 |
500 |
|
Activity 2 |
37,000 |
800 |
200 |
1,000 |
|
Activity 3 |
91,200 |
800 |
3,000 |
3,800 |
What is the overhead cost per unit for Product A under activity-based costing?
$18.53
$5.94
$6.60
$21.46