Question
Barnett Products manufactures three types of remote-control devices: Economy, Standard, and Deluxe. The company, which uses activity-based costing, has identified five activities (and related cost
Barnett Products manufactures three types of remote-control devices: Economy, Standard, and Deluxe. The company, which uses activity-based costing, has identified five activities (and related cost drivers). Each activity, its budgeted cost, and related cost driver is identified below.
| Activity | Cost | Cost Driver | ||||
| Material handling | $ | 304,000 | Number of parts | |||
| Material insertion | 3,000,000 | Number of parts | ||||
| Automated machinery | 911,000 | Machine hours | ||||
| Finishing | 220,000 | Direct labor hours | ||||
| Packaging | 220,000 | Orders shipped | ||||
| Total | $ | 4,655,000 | ||||
The following information pertains to the three product lines for next year:
| Economy | Standard | Deluxe | |||||||||
| Units to be produced | 15,400 | 7,200 | 2,400 | ||||||||
| Orders to be shipped | 1,800 | 790 | 290 | ||||||||
| Number of parts per unit | 10 | 20 | 30 | ||||||||
| Machine hours per unit | 1 | 3 | 5 | ||||||||
| Labor hours per unit | 3 | 3 | 3 | ||||||||
What is Barnetts pool rate for the material-handling activity?
Multiple Choice
$0.82 per part.
$1.97 per part.
$4.05 per labor hour.
$8.09 per part.
None of the answers is correct.
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Auditing Physician Services Verifying Accuracy In Physician Services And E M Coding To Protect Medical Practices
Authors: Betsy Nicoletti
3rd Edition
0998498564, 978-0998498560
