Bandolero Corporation has developed ideal standards for four activities: labor, materials, inspection, and receiving. Information is as follows: $$\begin{array} { l l r r r }
\text { Activity } & \text { Activity Driver } & \text { SQ } &{ \text { AQ } } & \text { SP } \
\text { Inspection } & \text { Inspection hours } & 0 & 40,000 & \$ 12 \
\text { Labor } & \text { Hours } & 50,000 & 56,000 & 18 \
\text { Materials } & \text { Pounds } & 100,000 & 105,000 & 15 \
\text { Receiving } & \text { Orders } & 150 & 190&450
\end{array}$$ The actual prices paid per unit of each activity driver were equal to the standard prices. The actual costs for receiving are
A)$49,500.
B)$67,500.
C)$85,500.
D)$18,000.

Question

Bandolero Corporation has developed ideal standards for four activities: labor, materials, inspection, and receiving. Information is as follows: $$\begin{array} { l l r r r } 
\text { Activity } & \text { Activity Driver } & \text { SQ } &{ \text { AQ } } & \text { SP } \
\text { Inspection } & \text { Inspection hours } & 0 & 40,000 & \$ 12 \
\text { Labor } & \text { Hours } & 50,000 & 56,000 & 18 \
\text { Materials } & \text { Pounds } & 100,000 & 105,000 & 15 \
\text { Receiving } & \text { Orders } & 150 & 190&450
\end{array}$$ The actual prices paid per unit of each activity driver were equal to the standard prices. The actual costs for receiving are
A)$49,500.
B)$67,500.
C)$85,500.
D)$18,000.

Quizplus · Accepted Answer

The actual costs for receiving are calculated by multiplying the actual quantity (AQ) of the activity driver (orders) by the standard price (SP) per unit of the activity driver. For receiving, AQ = 190 orders and SP = $450 per order. Therefore, the actual costs for receiving are 190 orders * $450/order = $85,500.

Bandolero Corporation Has Developed Ideal Standards for Four Activities: Labor