HAZELNUT COMPANY USES ACTIVITY-BASED COSTING. THE COM...

4. Hazelnut Company uses activity-based costing. The company produces two products:

coats and hats. The annual production and sales volume of coats is 8,000 units and of hats

is 6,000 units. There are three activity cost pools with the following expected activities and

estimated total costs:

Activity

Expected

Cost Pool Estimated

Cost Expected

Activity

Coats

Hats Total

Activity 1 P20,000 100 400 500

Activity 2 P37,000 800 200 1,000

Activity 3 P91,200 800 3,000 3,800

Using ABC, the cost per unit of coats is approximately:

a. P2.40 c. P 6.60

b. P3.90 d. P10.59