Under activity-based costing (ABC), the material-handling activity costs allocated to one lens would be what amount? The cost driver for the material-handling activity is the number of material moves.
Material-handling cost per lens:
[($50,000 ÷ (5 + 15)*)] x 5** = $500
25
Where: * Material moves’ total number
** The lens product line material moves’ number
Therefore, the material-handling cost per lens is $500
4. Answer the same question as in requirement (3), but for mirrors
Material-handling cost per mirror:
[($50,000 ÷ (5 + 15)*)] x 15** = $1,500
25
Where: * Material moves’ total number
** The mirror product line material moves’ number
Exercise 5-27 Page 201