The Cosmo Corporation manufactures and assembles office chairs. Cosmo uses an activity-based costing system to allocate all manufacturing conversion costs. Each chair consists of 15 separate parts totaling $125 in direct materials, and requires 2.0 hours of machine time to produce. Additional information follows:
Materials handling / # of parts / $1.75 per part
Machining / Machine hours / $2.00 per MH
Assembling / # of parts / $0.50 per part
Packaging / # of finished units / $2.75 per finished unit
What is the cost of machining per chair?
A) $26.25
B) $7.50
C) $5.50
D) $4.00
Answer : A) $26.25
Explanation: 1 chair = 15 parts × $1.75 per part = $26.25
You might also like to view...
The present value of $5,000 to be received in 4 years at a market rate of interest of 6% compounded annually is$3,636.30
a. True b. False Indicate whether the statement is true or false
Armando is generally uncomfortable communicating feelings, yet he is constantly looking for cues of rejection in his partners. Armando is exhibiting which attachment style?
A. giving B. avoidant C. mean D. anxious
Differentiate between brokers and agents
What will be an ideal response?
Which of the following is the most important indicator of a company's financial health?
a. net cash flow from financing activities; b. net cash flow from investing activities; c. net cash flow from operating activities; d. net cash sales; e. none of these.