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A Firm Produces and Sells Two Products,Standard and Deluxe Activity-Based Costing Would Allocate Which of the Following Amounts of Information

Question 94

Multiple Choice

A firm produces and sells two products,Standard and Deluxe.The following information relates to setup costs a part of factory overhead of $180,000.
 Standard  Deluxe  Units Produced 1,6001,600 Number of setups 100125 Direct labor hours per unit 99 Total direct labor costs $9,000$9,000\begin{array}{lrrr} & \underline{\textbf { Standard }} & & \underline{\textbf { Deluxe }} \\\text { Units Produced } & 1,600 & & 1,600 \\\text { Number of setups } & 100 & & 125 \\\text { Direct labor hours per unit } & 9 & & 9 \\\text { Total direct labor costs } & \$ 9,000 & & \$ 9,000\end{array} Activity-based costing would allocate which of the following amounts of setup cost to each unit rounded to the nearest dollar?
 Standard  Deluxe \begin{array}{} \underline{\textbf { Standard }} & \underline{\textbf { Deluxe }}\end{array}


A) $56 $ 56\begin{array}{} \$ 56 &\text { \$ } 56\end{array}
B) $50$63\begin{array}{} \$ 50 & \$ 63 \end{array}
C) $126$101\begin{array}{} \$ 126 & \$ 101 \end{array}
D) $356$444\begin{array}{} \$ 356 & \$ 444 \end{array}

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