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ID: 2541904 • Letter: C

Question

C O ezto.mheducation.com/hmtp Ed vesmoves! Hawkes Loarning" Blackboard Learn Welcome . my inv (1)Rarbow Six . Si, DExam " introduction to Managerial Accounting: Spring 2018 Online ACCT 2302.90L Hugo Rivas COUNTING instructions Ihelp Question 5 (of 25) Save & Ext Submi Cottionwood, Inc. produces two different products (Standard and Luxury) using two diferent activities: Mechining which uses machine hours as an activity driver and Inspection, which uses number of batches os an activity driver. The cost of Machining is SS 0 0. while the cost of r specto is S30 00. Standard uses 25% of total machine hours and 75% of tet" e es. What s the total activity cost essigned to Luxury? O $7500 O $375.000 O $147.500 O $382.500 Type here to search

Explanation / Answer

Total activity cost assigned to luxury = $382500/-

Cost allocated Perticulars Total cost Cost drivers Standard Luxury Machine cost $500,000 25% standard + 75% luxury $125,000 $375,000 (500000*25%) (500000*75%) Inspection cost $30,000 75% standard + 25% luxury $22,500 $7,500 (30000*75%) (30000*25%) Total Cost $147,500 $382,500