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Giftmonger Party Supplies uses value stream income statements. These statements include three value streams and two non-value streams. The first value stream is the Birthday

Giftmonger Party Supplies uses value stream income statements. These statements include three value streams and two non-value streams. The first value stream is the Birthday Party value stream. In this value stream, the value stream income statement shows the following cost numbers: $100,000 materials cost, $150,000 labor cost, and $75,000 variable overhead cost. (The firm has no fixed overhead.)

Which of the following is MOST LIKELY to be TRUE about these cost numbers?

a.

These cost numbers are the standard dollar amounts for the firm's work in the Birthday Party value stream.

b.

These cost numbers are the actual dollar amounts incurred by the firm for work in the Birthday Party value stream.

c.

These cost numbers are net of quantity and price variances for direct materials, direct labor, and variable overhead.

d.

These cost numbers are the actual dollar amounts incurred by the firm except for variable overhead, which is applied to individual product units using a PDOH rate.

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