Question
A Company manufactures ceiling fans and uses an activity-based costing system. Each ceiling fan consists of 20 separate parts. The direct material cost is $95
A Company manufactures ceiling fans and uses an activity-based costing system. Each ceiling fan consists of 20 separate parts. The direct material cost is $95 and each ceiling fan requires 2.5 hours of machine time to manufacture. Additional information is as follows:
What is the cost of machining per ceiling fan?
Activity Materials handling Machining Assembling Packaging Allocation Base Cost Allocation Rate $ Number of parts 0.08 Machine hours 7.20 Number of parts 0.35 Number of finished units 2.70
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