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Cheezy Snack produces rice crackers, wheat crackers, and corn crackers on three different production lines in the same manufacturing facility. Currently Cheezy uses a single
Cheezy Snack produces rice crackers, wheat crackers, and corn crackers on three different production lines in the same manufacturing facility. Currently Cheezy uses a single plantwide overhead rate to allocate its $ of annual manufacturing overhead. Of this amount, $ is associated with the rice cracker line, $ with the wheat cracker line, and $ with the corn cracker line. Cheezy's plant is currently running a total of machine hours: in the rice cracker line, with the wheat cracker line, and with the corn cracker line. Cheezy's considers machine hours to be the cost driver of MOH costs. Which products are being over costed due to the use of a single plantwide overhead allocation rate?
A Just the Rice Cracker
B Just the Wheat Cracker
C None of them
D All of them
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