Answer the following questions using the information below:
Whitman Printing has contracts to complete weekly supplements required by forty-six customers. For the year 20X5, manufacturing overhead cost estimates total $840,000 for an annual production capacity of 12 million pages.
For 2010 Whitman Printing decided to evaluate the use of additional cost pools. After analyzing manufacturing overhead costs, it was determined that number of design changes, setups, and inspections are the primary manufacturing overhead cost drivers. The following information was gathered during the analysis:
During 2010, two customers, Money Managers and Hospital Systems, are expected to use the following printing services:

-A primary reason for assigning selling and distribution costs to products for analytical purposes is:
A)to justify a varied product mix
B)that controllers are required to assign all costs when valuing inventories
C)that different processes, products, and customers require different quantities of selling and distribution activities
D)that all indirect costs must be assigned

Question

Answer the following questions using the information below:
Whitman Printing has contracts to complete weekly supplements required by forty-six customers. For the year 20X5, manufacturing overhead cost estimates total $840,000 for an annual production capacity of 12 million pages.
For 2010 Whitman Printing decided to evaluate the use of additional cost pools. After analyzing manufacturing overhead costs, it was determined that number of design changes, setups, and inspections are the primary manufacturing overhead cost drivers. The following information was gathered during the analysis:
  During 2010, two customers, Money Managers and Hospital Systems, are expected to use the following printing services:
 
-A primary reason for assigning selling and distribution costs to products for analytical purposes is:
A)to justify a varied product mix 
B)that controllers are required to assign all costs when valuing inventories 
C)that different processes, products, and customers require different quantities of selling and distribution activities 
D)that all indirect costs must be assigned

Quizplus · Accepted Answer

Assigning selling and distribution costs to products is done because different processes, products, and customers require different quantities of selling and distribution activities. This helps in better analysis of the costs and profitability of each product. Option A and B are not correct as they do not directly relate to the reason for assigning selling and distribution costs. Option D is also not correct as not all indirect costs need to be assigned to products.

Answer the Following Questions Using the Information Below