Q10/Fey Corporation manufactures two models of office chairs, a standard and a deluxe model. The following activity and cost information has been compiled: Number of Product Standard Deluxe Setups B.$70,400 C.$75,000 D.$45,000 22 Number of Number of Components Direct Labor Hours 8 28 Overhead costs $40,000 Number of setups and number of components are identified as activity-cost drivers for overhead. Assuming an activity-based costing system is used, what is the total amount of overhead costs assigned to the deluxe model? Group of answer choices A. $49,600 375 225 12 $80,000

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Q10/Fey Corporation manufactures two models of office chairs, a standard and a deluxe model. The following activity and cost
information has been compiled:
Number of
Setups
Number of
Components
Number of
Direct Labor Hours
Product
Standard
22
Deluxe
28
Overhead costs
$40,000
Number of setups and number of components are identified as activity-cost drivers for overhead. Assuming an activity-based costing
system is used, what is the total amount of overhead costs assigned to the deluxe model?
Group of answer choices
A. $49,600
B.$70,400
C.$75,000
D.$45,000
8
12
$80,000
375
225
Transcribed Image Text:Q10/Fey Corporation manufactures two models of office chairs, a standard and a deluxe model. The following activity and cost information has been compiled: Number of Setups Number of Components Number of Direct Labor Hours Product Standard 22 Deluxe 28 Overhead costs $40,000 Number of setups and number of components are identified as activity-cost drivers for overhead. Assuming an activity-based costing system is used, what is the total amount of overhead costs assigned to the deluxe model? Group of answer choices A. $49,600 B.$70,400 C.$75,000 D.$45,000 8 12 $80,000 375 225
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