Multiple Choice QuestionJohnson Company has the following overhead costs: machine setup $25,000; factory services $10,000; design of $15,000; and selling expenses of $5,000. What is the total overhead costs using activity-based costing?Multiple choice question.$50,000.$40,000.$20,000.$55,000.
Question
Multiple Choice QuestionJohnson Company has the following overhead costs: machine setup 10,000; design of 5,000. What is the total overhead costs using activity-based costing?Multiple choice question.40,000.55,000.
Solution
To calculate the total overhead costs using activity-based costing, you need to add up all the overhead costs mentioned.
Here's how you do it:
- Machine setup cost: $25,000
- Factory services cost: $10,000
- Design cost: $15,000
- Selling expenses: $5,000
Now, add all these costs together:
10,000 (factory services) + 5,000 (selling expenses) = $55,000
So, the total overhead costs using activity-based costing is 55,000.
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