The Following Is Taken from Clausen Company's Internal Records of Its

question 10

Multiple Choice

The following is taken from Clausen Company's internal records of its factory with two operating departments.The cost driver for indirect labor is direct labor hours,and the cost driver for the remaining items is number of hours of machine use.Compute the total amount of indirect labor allocated to Dept.1 using activity-based costing.

• A)$5,505.
• B)$54,371.
• C)$16,864.
• D)$10,471.
• E)$8,073.

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Definitions:

Restricted

Refers to assets or conditions that are limited in terms of access, use, or transferability due to legal, contractual, or regulatory requirements.

Modified Accrual Accounting

A method of accounting that recognizes revenues when they become measurable and available to finance expenditures of the fiscal period, and expenditures are recognized when the related fund liability is incurred.

Revenues Recognized

Income that a company has earned during a period but which is recorded in the financial statements according to accounting principles.

Proprietary Fund Types

Funds used by a government to account for activities similar to those found in the private sector, where the determination of net income is necessary or useful.