This Question: 1 pt 16 of 32 (10 complete) This Test: 32 pts poss Beaver Company

Question

This Question: 1 pt 16 of 32 (10 complete) This Test: 32 pts poss Beaver Company manufactures coffee tables and uses an activity-based costing system to allocate all manufacturing conversion costs. Each coffee tables consists of 20 separate parts totaling $230 in direct materials, and requires 7 hours of machine time to produce Additional information follows Cost Allocation Rate $2 00 per part $5.50 per machine hour $5.00 per part $7.00 per inished unit Activity Materials handling Machining Assembling Packaging Allocation Base Number of parts Machine hours Number of parts Number of finished units What is the cost of machining per coffee table? O A. $38.50 B. S4900 C. $100.00 OD. $110.00

Explanation / Answer

Correct Answer is A = $ 38.50 Calculation of Cost of Machining per Coffee table: (Machine Hours X Cost per Machine hour) Machine Hours = 7 Cost per Machine hour = $   5.50 Calculation of Cost of Machining per Coffee table = $ 38.50 (7 hours X $5.50)

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