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Yallow, Inc. manufactures teddy bears and dolls. Currently, Yallow makes 3,000 teddy bears each month. Each teddy bear uses $17.00 in direct materials and
Yallow, Inc. manufactures teddy bears and dolls. Currently, Yallow makes 3,000 teddy bears each month. Each teddy bear uses $17.00 in direct materials and $5.50 in direct labor. Yallow uses two activities in manufacturing the teddy bears: Sewing and Processing. The cost associated with Sewing is $22,500 a month, allocated on the basis of direct labor hours. The cost associated with Processing is $15,000 a month, allocated on the basis of batches. The activity drivers are used as follows: Teddy Bears Dolls Direct labor hours Batches 220 220 175 325 What is the total manufacturing cost for one teddy bear? Multiple Choice $22.50 $27.00 $24.50 $28.00
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