FreshBake Ltd. produces gourmet pastries. Utility costs are allocated to the products based on oven baking time. The budgeted utility cost for the current period is $180,000, and the total expected baking time is 360,000 minutes. If a batch of croissants requires 25 minutes of baking time, what amount of utility cost will be allocated to that batch? a) $10 b) $12.50 c) $15 d) $20

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter10: Short-term Decision Making
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FreshBake Ltd. produces gourmet pastries. Utility costs
are allocated to the products based on oven baking
time. The budgeted utility cost for the current period is
$180,000, and the total expected baking time is 360,000
minutes. If a batch of croissants requires 25 minutes of
baking time, what amount of utility cost will be
allocated to that batch?
a) $10
b) $12.50
c) $15
d) $20
Transcribed Image Text:FreshBake Ltd. produces gourmet pastries. Utility costs are allocated to the products based on oven baking time. The budgeted utility cost for the current period is $180,000, and the total expected baking time is 360,000 minutes. If a batch of croissants requires 25 minutes of baking time, what amount of utility cost will be allocated to that batch? a) $10 b) $12.50 c) $15 d) $20
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