Table 305 Assume That in Table 30

question 48

Multiple Choice

Table 30.5 $$\begin{array} { | r | c | c | c | } \hline \text { Output (urits) } & \text { Labor (urits) } & \text { Output (urits) } & \text { Capital (urits) } \\\hline 10 & 1 & 20 & 1 \\\hline 26 & 2 & 56 & 2 \\\hline 38 & 3 & 86 & 3 \\\hline\end{array}$$ Assume that in Table 30.5 the cost of labor is $4 per unit and the cost of capital is $6 per unit.In Table 30.5,what is the cost efficiency of the second unit of labor?

• A)64 units per $1 of cost.
• B)16 units per $1 of cost.
• C)26 units per $1 of cost.
• D)4 units per $1 of cost.

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Definitions:

Machine-Hours

A measure of the amount of time a machine is operated, used in manufacturing to allocate overhead costs to products.

Machine-Hours

A metric signifying the amount of time a machine operates, utilized for computing the costs and effectiveness of production.

Predetermined Overhead Rate

A rate used to apply manufacturing overhead cost to products, calculated before the production period begins.

Manufacturing Overhead

All indirect costs related to the manufacturing process, such as utilities, maintenance, and salaries of supervisory personnel.