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Disc uses activity-based costing. Two of Disc's production activities are kitting (assembling the raw materials needed for each computer in one kit) and boxing the
Disc uses activity-based costing. Two of Disc's production activities are kitting (assembling the raw materials needed for each computer in one kit) and boxing the completed products for shipment to customers. Assume that Disc spends $4,500,000 per month on kitting and $19,000,000 per month on boxing. Disc allocates the following: Kitting costs based on the number of parts used in the computer Boxing costs based on the cubic feet of space the computer requires Suppose Disc estimates it will use 90,000,000 parts per month and ship products with a total volume of 29,687,500 cubic feet per month. Assume that each desktop computer requires 175 parts and has a volume of 8 cubic feet. What are the predetermined overhead allocation rates? (Round all calculations to the nearest cent.) O A. Kitting Boxing $20.00 per part $1.56 per cubic foot B. Kitting Boxing $0.05 per part $0.64 per cubic foot OC. Kitting Boxing $0.04 per part $0.16 per cubic foot OD Kitting Boxing $0.15 per part $0.21 per cubic foot
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