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Kratz Manufacturing Company uses an activity-based costing system. It has the following manufacturing activity areas, related cost drivers and cost allocation rates: Cost Allocation Rate
Kratz Manufacturing Company uses an activity-based costing system. It has the following manufacturing activity areas, related cost drivers and cost allocation rates: Cost Allocation Rate Cost Driver Activity Number of setups Machine setup $50.00 Materials handling Number of parts 0.50 Machining Machine hours 13.00 Direct labor hours Assembly 22.00 Number of finished units Inspection 14.00 During the month, 100 units were produced, with no defects, requiring three setups. Each unit consisted of 17 parts, 3 direct labor hours and 2.5 machine hours. Direct materials cost $50 per finished unit. What is the total manufacturing cost for materials handling? Select one: A. $850 B. $750 C. $375 D. $500
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