XAG-B company is reviewing the behavior of its various activities. XAG is currently the company uses a plant-wide rate for allocating manufacturing overhead. The plant manager believes it is time to refine the method of cost allocation and has the accounting department identify the primary production activities and their cost drivers:

ActivitiesCost driverAllocation Rate

Material handlingNumber of parts$2 per part

AssemblyLabor hours$20 per hour

InspectionTime at inspection station$3 per minute

The current traditional cost method allocates overhead based on direct manufacturing labor hours using a rate of $200 per labor hour.

What are the indirect manufacturing costs per remote control assuming an activity-based-costing method is used and a batch of 50 remote controls are produced?The batch requires 100 parts, 6 direct manufacturing labor hours, and 2.5 minutes of inspection time.

Select one:

a.$4.00 per remote control

b.$24.00 per remote control

c.$6.55 per remote control

d.$327.50 per remote control

Woxy company is considering its forthcoming projections for budget purposes. Doxy's projected sales for next year and beginning and ending inventory data are as follows:

Sales

50,000 units

Beginning inventory

4,000 units

Desired ending inventory

8,000 units

The selling price is $40 per unit. Each unit requires four pounds of material which costs $6 per pound. The beginning inventory of raw materials is 12,000 pounds. The company wants to have 3,000 pounds of material in inventory at the end of the year.

Doxys' budgeted total purchase cost of direct materials would be

Select one:

a.$1,206,000

b.$1,296,000

c.$1,242,000

d.$1,350,000