Activity Cost Driver Chosen as Allocation Base Conversion Cost Per Unit of Allocation Base Materials handling Number of parts $1.00 Machining Machine hours 60.00 Packaging Number of finished units 2.00 Each windsock requires three parts and spends five minutes in the machining department. The total cost of direct materials and direct labor is $3.50 per windsock. Gale produces 20,000 windsocks each year and sells them at 140% of cost. The total cost of producing the 20,000 windsocks is: Question 7 options: $160,000. $230,000. $270,000. $1,260,000.
Activity Cost Driver Chosen as Allocation Base Conversion Cost Per Unit of Allocation Base Materials handling Number of parts $1.00 Machining Machine hours 60.00 Packaging Number of finished units 2.00 Each windsock requires three parts and spends five minutes in the machining department. The total cost of direct materials and direct labor is $3.50 per windsock. Gale produces 20,000 windsocks each year and sells them at 140% of cost. The total cost of producing the 20,000 windsocks is: Question 7 options: $160,000. $230,000. $270,000. $1,260,000.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
|
Activity |
Cost Driver Chosen as Allocation Base |
Conversion Cost Per Unit of Allocation Base |
| Materials handling | Number of parts | $1.00 |
| Machining | Machine hours | 60.00 |
| Packaging | Number of finished units | 2.00 |
Each windsock requires three parts and spends five minutes in the machining department. The total cost of direct materials and direct labor is $3.50 per windsock. Gale produces 20,000 windsocks each year and sells them at 140% of cost.
The total cost of producing the 20,000 windsocks is:
Question 7 options:
|
|
$160,000. |
|
|
$230,000. |
|
|
$270,000. |
|
|
$1,260,000. |
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