Fox Hunting Gear Manufactures Two Products: Camouflage Jackets and Camouflage

question 104

Multiple Choice

Fox Hunting Gear manufactures two products: camouflage jackets and camouflage hats. The company makes 50,000 jackets and 20,000 hats each year. Information for overhead costs and for the two products appears below.
$\begin{array}{|l|c|c|c|c|}\hline &&\text { Estimated }\\&&\text { Total }\\ \text { Activity }&\text { Driver }&\text { Overhead Cost }&\text { Jackets }&\text { Hats }\\\hline \text { Setups } & \text { \# of setups } & \$ 200,000 & 500 \text { setups } & 1,500 \text { setups } \\\hline \text { Ordering parts } & \text { \# of parts } & 300,000 & 60,000 \text { parts } & 40,000 \text { parts } \\\hline \text { Machining } & \text { \# of machine hours } & 600,000 & 12,000 \text { machine hrs. } & 6,000 \text { machine hrs. } \\\hline \text { Inspections } & \text { \# of inspections } & 400,000 & 10,000 \text { inspections } & 40,000 \text { inspections } \\\hline \text { Shipping } & \text { \# of shipments } & 300,000 & 10,000 \text { shipments } & 10,000 \text { shipments } \\\hline \text { Total overhead }&&\$1,800,000\\\hline\end{array}$
Assume that activity-based costing is used. What is the rate per setup that should be used to assign setup cost to hats?

• A) $100 per setup
• B) $200,000 per setup
• C) $133.33 per setup
• D) $900 per setup

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Definitions:

Familial Distress

Emotional strain and stress that occurs within a family due to various reasons, including financial problems, illness, or conflict.

Lost Child

A family role where the individual becomes invisible and neglected as family attention often focuses on more demanding or problematic members.

Unwritten Rules

Implicit norms or expectations that are not formally documented but guide behavior within a social group or organization.

Family System

A concept in psychology that views the family as an emotional unit, emphasizing the interconnectedness and interdependence of family members.