St James, Inc, currently uses traditional costing procedures, applying S800.000 of overhead to products Beta and Zeta on the basis of direct labor hours. The company is considering a shift to activity-based costing and the creation of individual cost pools that will use direct labor hours (DLH), production setups (SU), and number of parts components (PC) as cost drivers. Data on the costs pools and respective driver volumes follow: Pool No. 1 Pool No. 2 Pool No. 3 Product (Driver: DLH) (Driver: SU) (Driver: PC) Beta 1.200 45 2250 Zeta 2.800 55 750 Pool Cost $160,000 $280.000 S360.000 2 The overhead cost allocated to Zeta by using traditional costing procedures would be: a. $240,000 b. $356,000 C $444,000 d. $560,000

St James, Inc, currently uses traditional costing procedures, applying S800.000 of overhead to products Beta and Zeta on the basis of direct labor hours. The company is considering a shift to activity-based costing and the creation of individual cost pools that will use direct labor hours (DLH), production setups (SU), and number of parts components (PC) as cost drivers. Data on the costs pools and respective driver volumes follow: Pool No. 1 Pool No. 2 Pool No. 3 Product (Driver: DLH) (Driver: SU) (Driver: PC) Beta 1.200 45 2250 Zeta 2.800 55 750 Pool Cost $160,000 $280.000 S360.000 2 The overhead cost allocated to Zeta by using traditional costing procedures would be: a. $240,000 b. $356,000 C $444,000 d. $560,000

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Description: St. James, Inc., currently uses traditional costing procedures, applying Ss800,000 of overhead to productsBeta and Zeta on the basis of direct labor hours. The company is considering a shift to activity-basedcosting and the creation of individual co

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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