Telecom uses activity - based costing to allocate all manufacturing conversion costs. Telecom produces cellular telephones; each phone has $20.00 of direct materials, includes 50 parts and requires 3 hours of machine time. Additional information follows: Activity Materials handling Machining Assembling Packaging What is the cost of machining per phone? O A. $6 # OB. $9 O C. $200 D. $175 Allocation Base Number of parts Machine hours Number of parts Number of finished units Cost Allocation Rate $3.50 per part $2.00 per machine hour $4.00 per part $3.00 per finished unit

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
icon
Concept explainers
Topic Video
Question
Telecom uses activity - based costing to allocate all manufacturing conversion costs. Telecom produces cellular telephones; each phone has $20.00 of
direct materials, includes 50 parts and requires 3 hours of machine time. Additional information follows:
Activity
Materials handling
Machining
Assembling
Packaging
What is the cost of machining per phone?
A. $6
B. $9
C. $200
O D. $175
Allocation Base
Number of parts
Machine hours
Number of parts
Number of finished units
Cost Allocation Rate
$3.50 per part
$2.00 per machine hour
$4.00 per part
$3.00 per finished unit
Transcribed Image Text:Telecom uses activity - based costing to allocate all manufacturing conversion costs. Telecom produces cellular telephones; each phone has $20.00 of direct materials, includes 50 parts and requires 3 hours of machine time. Additional information follows: Activity Materials handling Machining Assembling Packaging What is the cost of machining per phone? A. $6 B. $9 C. $200 O D. $175 Allocation Base Number of parts Machine hours Number of parts Number of finished units Cost Allocation Rate $3.50 per part $2.00 per machine hour $4.00 per part $3.00 per finished unit
Expert Solution
steps

Step by step

Solved in 3 steps

Blurred answer
Knowledge Booster
Costing Systems
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education