Question
QUESTION 10 Barnett Products manufactures three types of remote-control devices: Economy, Standard, and Deluxe. The company, which uses activity-based costing, has identified five activities (and
QUESTION 10
Barnett Products manufactures three types of remote-control devices: Economy, Standard, and Deluxe. The company, which uses activity-based costing, has identified five activities (and related cost drivers). Each activity, its budgeted cost, and related cost driver is identified below.
| Activity | Cost | Cost Driver | ||||
| Material handling | $ | 237,000 | Number of parts | |||
| Material insertion | 3,330,000 | Number of parts | ||||
| Automated machinery | 846,000 | Machine hours | ||||
| Finishing | 206,000 | Direct labor hours | ||||
| Packaging | 206,000 | Orders shipped | ||||
| Total | $ | 4,825,000 | ||||
The following information pertains to the three product lines for next year:
| Economy | Standard | Deluxe | |||||||||
| Units to be produced | 17,000 | 8,800 | 2,350 | ||||||||
| Orders to be shipped | 1,620 | 840 | 270 | ||||||||
| Number of parts per unit | 10 | 20 | 30 | ||||||||
| Machine hours per unit | 1 | 2 | 5 | ||||||||
| Labor hours per unit | 3 | 3 | 3 | ||||||||
What is Barnetts pool rate for the packaging activity?
Multiple Choice
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$2.30 per machine hour.
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$2.44 per labor hour.
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$7.55 per unit.
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$75.46 per order shipped.
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None of the answers is correct.
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Accounting And Financial System Reform In Eastern Europe And Asia
Authors: Robert W. McGee, Galina G. Preobragenskaya
2nd Edition
0387257098, 9780387257099
