Products at Krause Manufacturing Are Sent Through Two Production Departments

question 123

Multiple Choice

Products at Krause Manufacturing are sent through two production departments: Fabricating and Finishing.Overhead is applied to products in the Fabricating Department based on 150 percent of direct labor cost and $18 per machine hour in Finishing.The following information is available about Job #297: What is the total cost of Job #297?

• A)$2,647
• B)$3,005
• C)$3,093
• D)$3,203

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Definitions:

Labor Agreement

A contractual agreement between an employer and a group of employees (often represented by a union) regarding terms of employment.

Break-Even Analysis

An evaluation to determine the point at which revenues and expenses are equal, and no net loss or gain is achieved.

Variable Costs

Costs that change in proportion to the level of activity or volume of output in a business, such as materials and labor costs.

Break-Even Point

The point at which total cost and total revenue are equal, meaning that the business makes neither a profit nor a loss.