Aberdeen Corp. uses activity-based costing system with three activity cost pools. The following cost information is provided:
Wages and salaries $ 220,000
Depreciation 120,000
Utilities 100,000
Total $440,000
To calculate the allocation rates for the activity-based costing system, we need to determine the allocation bases for each activity cost pool. The allocation rates will help allocate the total cost of $440,000 to different cost objects based on their consumption of each activity.
Let's assume that the three activity cost pools are:
1. Wages and Salaries
2. Depreciation
3. Utilities
For each activity cost pool, we need to identify an appropriate allocation base that represents the consumption of that activity. Common examples of allocation bases include machine hours, direct labor hours, or units produced.
Once we have determined the allocation bases, we can calculate the allocation rates by dividing the total cost of each activity by its corresponding allocation base.
However, since the allocation bases are not provided in the given information, we cannot calculate the allocation rates accurately. We would need additional data that describes the allocation bases for each activity.
Please provide the allocation bases for each activity, and I will be able to assist you in calculating the allocation rates.