Production workers for Kirby Manufacturing Company provided 280 hours of labor in January and 500 hours in
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Production workers for Kirby Manufacturing Company provided 280 hours of labor in January and 500 hours in February. Kirby expects to use 4,000 hours of labor during the year. The rental fee for the manufacturing facility is $7,000 per month.
Required
Explain why allocation is needed. Based on this information, how much of the rental cost should be allocated to the products made in January and to those made in February?
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There is a logical relationship between the amount of labor and the level of prod...View the full answer
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