Question
COVID CO. uses a 5,000 square foot factory space that it rents for $2,500 a month for all its manufacturing activities. Production manager has decided
COVID CO. uses a 5,000 square foot factory space that it rents for $2,500 a month for all its manufacturing activities. Production manager has decided to switch to an activity-based costing system, and has identified its activities as follows: Preparation and Setup, Machining, Finishing, and Quality Control. 600 square feet of the factory are used for machining, while 2,000 square feet (each) are used for Preparation and Setup and Quality Control. Finishing uses 400 square feet. When assigning indirect costs to each activity, how much factory rent should be assigned to the Finishing cost pool? Select one: O a. $1,000 O b. $2,000 Oc. $300 d. $200 e. None of the given
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