Deemer Corporation Has an Activity-Based Costing System with Three Activity

question 55

Multiple Choice

Deemer Corporation has an activity-based costing system with three activity cost pools--Processing, Supervising, and Other. In the first stage allocations, costs in the two overhead accounts, equipment expense and indirect labor, are allocated to the three activity cost pools based on resource consumption. Data used in the first stage allocations follow: Distribution of Resource Consumption Across Activity Cost Pools:
Processing costs are assigned to products using machine-hours (MHs) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow:
Activity:
What is the overhead cost assigned to Product X0 under activity-based costing?

• A) $41,580
• B) $39,500
• C) $47,900
• D) $6,320

Evaluate the factors contributing to labor productivity differences among economies.

Identify factors that do not directly contribute to the productivity of labor.

Understand the relationship and differences between average product and marginal product of labor.

Analyze the effects of increasing labor use on output, including the conditions under which the law of diminishing returns applies.

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Definitions:

Observational Study

A research method involving the collection of data without interference with the subjects’ natural environment.

Case-control

A type of observational study that compares individuals with a specific condition (cases) to those without the condition (controls) to identify potential risk factors.

Retrospective

Looking back on or dealing with past events or situations.

Independent Risk Factor

A variable that on its own increases the likelihood of developing a disease or health condition, independent of other factors.