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Alphabet Technology produces a high-end laptop under the label Excellent Laptops and an inexpensive desktop under the label Outstanding Computers. The two products use two
Alphabet Technology produces a high-end laptop under the label Excellent Laptops and an inexpensive desktop under the label Outstanding Computers. The two products use two overhead activities, with the following costs:
Line Item Description | Amount |
---|---|
Setting up equipment | $3,000 |
Machining | $15,000 |
The controller has collected the expected annual prime costs for each product, the machine hours, the setup hours, and the expected production.
Line Item Description | Excellent Laptops | Outstanding Computers |
---|---|---|
Direct labor | $25,000 | $10,000 |
Direct materials | $20,000 | $5,000 |
Expected production in units | 3,000 | 3,000 |
Machine hours | 850 | 2,000 |
Setup hours | 80 | 70 |
Calculate Outstanding Computers consumption ratio for setup hours. (Round answer to two decimal places.)
a. 0.25
b. 0.58
c. 0.47
d. 0.90
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