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Oxford Corporation has four categories of overhead. The expected overhead costs for each category for next year are as follows: Maintenance Materials handling Setups
Oxford Corporation has four categories of overhead. The expected overhead costs for each category for next year are as follows: Maintenance Materials handling Setups Inspection $210,000 90,000 75,000 150,000 The company has been asked to submit a bid for a proposed job for Alonso Corp.. The plant manager believes that obtaining this job would result in new business in future years. Bids are usually based upon full manufacturing cost plus 30 percent. Estimates for the proposed job are as follows: Direct materials Direct labor (375 hours) Number of material moves Number of inspections Number of setups Number of machine-hours $5,000 $7,500 2 150 Expected activity for the four activity-based cost drivers that would be used is: Machine-hours Material moves Setups Quality inspections 10,000 2,000 100 4,000
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