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Westmorland makes ink that it uses in ball point pens. The Company produces two colors of ink. One is blue the other is red. Ink
Westmorland makes ink that it uses in ball point pens. The Company produces two colors of ink. One is blue the other is red. Ink is made in batches with setup costs being $6,900 per batch Demand for blue ink is significantly stronger than for red ink. During the most recent week, the company made 2 batches of ink, one blue the other red It requires 1 hour of labor to make a gallon of ink regardless of color. There were 1.250 hours of labor used to make the blue ink and the 1,050 hours of labor used to make the red ink. If the Company uses a single company wide overhead rate based on labor hours, the amount of setup cost allocated to the Multiple Choice O blue ink is $6,300 and red ink is $7,500 O o O O blue ink is $6,900 and red ink is $6,900 blue ink is $7.500 and red ink is $6,300. O blue ink is $13,800 and red ink is zero
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