Answer the following questions using the information below:
Flinders Potters manufactures two sizes of ceramic paperweights,regular and jumbo.The following information applies to their expectations for the planning period:
$$\begin{array} { l c l }
\text { Cost Pool } & \text { Overhead Costs } & \text { Activity-cost Driver } \
\text { Materials handling } & \$ 50000 & 100000 \text { orders } \
\text { Machine maintenance } & \$ 300000 & 15000 \text { maintenance hours } \
\text { Set-ups } & \$ 270000 & 45000 \text { set-ups } \
\text { Inspections } & \$ 110000 & 22000 \text { inspections } \
\text { Total support costs } & \$ 730000 & \\
& { \text { Production Es timates } } \
& \text { Production urits: } \
& \text { Regular } = 8000000 \text { units } \
& \text { Jumbo } = 16000000 \text { units } \
& \text { Machine-hours } = 200000 \mathrm { mh } \
&\text { Labour-hours } = 400000 \mathrm { dlh }
\end{array}$$ Flinders Potters uses an ABC system and assigns overhead costs based on the overhead activity information provided above.
-During October,Flinders produced 700 000 regular ceramic paperweights and Flinders' production manager counted 2000 orders;1000 maintenance-hours;2000 set-ups;and 2000 inspections for the regular product line.For October,Flinders' controller assigned ________ indirect costs to the regular product line.
A)$43 000
B)$25 000
C)$34 000
D)None of these answers are correct.

Question

Answer the following questions using the information below:
Flinders Potters manufactures two sizes of ceramic paperweights,regular and jumbo.The following information applies to their expectations for the planning period:
 $$\begin{array} { l c l } 
\text { Cost Pool } & \text { Overhead Costs } & \text { Activity-cost Driver } \
\text { Materials handling } & \$ 50000 & 100000 \text { orders } \
\text { Machine maintenance } & \$ 300000 & 15000 \text { maintenance hours } \
\text { Set-ups } & \$ 270000 & 45000 \text { set-ups } \
\text { Inspections } & \$ 110000 & 22000 \text { inspections } \
\text { Total support costs } & \$ 730000 & \\
& { \text { Production Es timates } } \
 & \text { Production urits: } \
& \text { Regular } = 8000000 \text { units } \
& \text { Jumbo } = 16000000 \text { units } \
& \text { Machine-hours } = 200000 \mathrm { mh } \
&\text { Labour-hours } = 400000 \mathrm { dlh }
\end{array}$$ Flinders Potters uses an ABC system and assigns overhead costs based on the overhead activity information provided above.
-During October,Flinders produced 700 000 regular ceramic paperweights and Flinders' production manager counted 2000 orders;1000 maintenance-hours;2000 set-ups;and 2000 inspections for the regular product line.For October,Flinders' controller assigned ________ indirect costs to the regular product line.
A)$43 000
B)$25 000
C)$34 000
D)None of these answers are correct.

Quizplus · Accepted Answer

The correct answer is A.The total indirect costs assigned to the regular product line for October are $43,000. This is calculated as follows:Materials handling: $50,000 x (2,000 orders / 100,000 orders) = $1,000Machine maintenance: $300,000 x (1,000 maintenance-hours / 15,000 maintenance-hours) = $20,000Set-ups: $270,000 x (2,000 set-ups / 45,000 set-ups) = $12,000Inspections: $110,000 x (2,000 inspections / 22,000 inspections) = $10,000Total indirect costs: $1,000 + $20,000 + $12,000 + $10,000 = $43,000

Answer the Following Questions Using the Information Below: Flinders Potters

Answer the Following Questions Using the Information Below:
Flinders Potters