XYZ Company Has Budgeted Production of Item #123 for April

question 32

Multiple Choice

XYZ Company has budgeted production of Item #123 for April, May, and June of 2,400, 3,200, and 2,800 units, respectively.XYZ Company currently pays a standard rate of $3 per foot for raw material A and $5 per sheet for raw material B.Each unit produced requires 4 feet of raw material A and 2 sheets of raw material B.Each unit produced also requires 30 minutes of cutting direct labor time at a standard rate of $16 per hour and 2 hours of assembly direct labor time at a standard rate of $20 per hour.Manufacturing overhead is applied at the standard rate of $10 per direct labor hour. The total standard cost of May's budgeted production of Item #123 is:

• A)$198,400.
• B)$208,800.
• C)$304,000.
• D)$308,800.

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Definitions:

Capital Fund

A fund created for the purpose of undertaking capital projects or investing in long-term assets, funded by capital expenditures or external financing sources.

General Fund

The primary operating fund of a government, covering general operations and services not accounted for in special-purpose funds.

Direct Increase

A rise in the value or quantity of something without intervening steps or intermediaries.

Endowment Fund

A fund where the principal amount is kept intact while the investment income is available for use, typically for the ongoing support of an organization.