Answer the following question(s)using the information below:
The Fancy Flier Airplane Corporation has a central materials laboratory.The laboratory has only two users, the Large Plane Department and the Small Plane Department.The following data apply to the coming budget year:
Budgeted amounts are used to calculate the allocation rates.Actual usage for the year by the Large Plane Department was 6,000 technician hours and by the Small Plane Department was 6,500 technician hours.
-If a dual-rate cost allocation method is used, what amount of materials laboratory costs will be budgeted for the Large Plane Department?
A)$1,057,500
B)$822,500
C)$1,880,000
D)$1,600,000
E)$982,500

Question

Answer the following question(s)using the information below:
The Fancy Flier Airplane Corporation has a central materials laboratory.The laboratory has only two users, the Large Plane Department and the Small Plane Department.The following data apply to the coming budget year:
  Budgeted amounts are used to calculate the allocation rates.Actual usage for the year by the Large Plane Department was 6,000 technician hours and by the Small Plane Department was 6,500 technician hours.
-If a dual-rate cost allocation method is used, what amount of materials laboratory costs will be budgeted for the Large Plane Department?
A)$1,057,500 
B)$822,500 
C)$1,880,000 
D)$1,600,000 
E)$982,500

Quizplus · Accepted Answer

The dual-rate cost allocation method separates fixed and variable costs. The Large Plane Department's budgeted costs would be calculated based on its usage of the materials laboratory, considering both fixed and variable components. The correct budgeted amount is $1,057,500.

Answer the Following Question(s)using the Information Below