National Inc.manufactures two models of CMD that can be used as cell phones,MPX,and digital camcorders.
National uses a volume-based costing system to apply factory overhead based on direct labor dollars.The unit prime costs of each product were as follows:
National's controller had been researching activity-based costing and decided to switch to it.A special study determined National's two products have the following budgeted activities:
What is the overhead application rate using the firm's volume-based costing system (rounded to the nearest percent or cents)?
A)350 percent of direct labor cost.
B)$51.89 per direct labor-hour.
C)68 per cent of direct labor cost.
D)5,189 percent of direct labor cost.
E)5,110 percent of direct labor cost.

Question

National Inc.manufactures two models of CMD that can be used as cell phones,MPX,and digital camcorders. 
National uses a volume-based costing system to apply factory overhead based on direct labor dollars.The unit prime costs of each product were as follows: 
National's controller had been researching activity-based costing and decided to switch to it.A special study determined National's two products have the following budgeted activities: 
What is the overhead application rate using the firm's volume-based costing system (rounded to the nearest percent or cents)?
A)350 percent of direct labor cost. 
B)$51.89 per direct labor-hour. 
C)68 per cent of direct labor cost. 
D)5,189 percent of direct labor cost. 
E)5,110 percent of direct labor cost.

Quizplus · Accepted Answer

The Answer of National Inc.manufactures two models of CMD that can be used as cell phones,MPX,and digital camcorders. 
National uses a volume-based costing system to apply factory overhead based on direct labor dollars.The unit prime costs of each product were as follows: 
National's controller had been researching activity-based costing and decided to switch to it.A special study determined National's two products have the following budgeted activities: 
What is the overhead application rate using the firm's volume-based costing system (rounded to the nearest percent or cents)?
A)350 percent of direct labor cost. 
B)$51.89 per direct labor-hour. 
C)68 per cent of direct labor cost. 
D)5,189 percent of direct labor cost. 
E)5,110 percent of direct labor cost.