Evergreen Inc. expects to manufacture 4,000 refrigerators during the last quarter of the current year. The company uses activity-based costing to determine the product costs. The manufacturing activities and associated information is provided as follows: Overhead activities Overhead costs assigned ($) Number of cost driver Material handling $150,000 120,000 Parts Devising $400,000 50,000 Machine hours (MH) Assembling $180,000 120,000 Parts Finishing $170,000 4,000 Finishing hours (FH) Each refrigerator uses 30 parts and requires 5 machine hours and 1 finishing hour during the production process. The direct material costs and direct labor costs required for each refrigerator is $500 and $90, respectively. The amount of material handling and assembling costs allocated to each refrigerator would be: (Round your answer to two decimal points) Group of answer choices $21.00 per unit $41.25 per unit $36.00 per unit $82.50 per unit
Evergreen Inc. expects to manufacture 4,000 refrigerators during the last quarter of the current year. The company uses activity-based costing to determine the product costs. The manufacturing activities and associated information is provided as follows: Overhead activities Overhead costs assigned ($) Number of cost driver Material handling $150,000 120,000 Parts Devising $400,000 50,000 Machine hours (MH) Assembling $180,000 120,000 Parts Finishing $170,000 4,000 Finishing hours (FH) Each refrigerator uses 30 parts and requires 5 machine hours and 1 finishing hour during the production process. The direct material costs and direct labor costs required for each refrigerator is $500 and $90, respectively. The amount of material handling and assembling costs allocated to each refrigerator would be: (Round your answer to two decimal points) Group of answer choices $21.00 per unit $41.25 per unit $36.00 per unit $82.50 per unit
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Evergreen Inc. expects to manufacture 4,000 refrigerators during the last quarter of the current year. The company uses activity-based costing to determine the product costs. The manufacturing activities and associated information is provided as follows:
| Overhead costs assigned ($) | Number of cost driver | |
| Material handling | $150,000 | 120,000 Parts |
| Devising | $400,000 | 50,000 Machine hours (MH) |
| Assembling | $180,000 | 120,000 Parts |
| Finishing | $170,000 | 4,000 Finishing hours (FH) |
Each refrigerator uses 30 parts and requires 5 machine hours and 1 finishing hour during the production process. The direct material costs and direct labor costs required for each refrigerator is $500 and $90, respectively. The amount of material handling and assembling costs allocated to each refrigerator would be: (Round your answer to two decimal points)
Group of answer choices
$21.00 per unit
$41.25 per unit
$36.00 per unit
$82.50 per unit
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