Whirlwind Fan Company Manufactures Ceiling Fans and Uses an Activity-Based

question 217

Multiple Choice

Whirlwind Fan Company manufactures ceiling fans and uses an activity-based costing system.Each ceiling fan has 20 separate parts.The direct material cost is $85,and each ceiling fan requires 2.50 hours of machine time to manufacture.Additional information is as follows: $$\begin{array} { | l | l | l | } \hline \text { Activity } & \text { Allocation Base } & \begin{array} { l } \text { Predetermined Overhead } \\\text { Allocation Rate }\end{array} \\\hline \text { Materials handling } & \text { Number of parts } & \$ 0.08 \\\hline \text { Machining } & \text { Machine hours } & 6.00 \\\hline \text { Assembling } & \text { Number of parts } & 0.25 \\\hline \text { Packaging } & \text { Number of finished units } & 4.00 \\\hline\end{array}$$ What is the cost of materials handling per ceiling fan? (Round any intermediate calculations and your final answer to two decimal places.)

• A) $1.60
• B) $6.00
• C) $4.00
• D) $10.00

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Definitions:

Intellectual Property Rights

Legal rights granted to creators and owners over their inventions, designs, music, and other forms of creative work.

Promotional Communication Policy

Guidelines and practices that govern how an organization communicates about its promotions, offers, and marketing campaigns to its audience.

Gamification Strategies

Techniques that apply elements of game playing (e.g., point scoring, competition) to other areas of activity to enhance engagement and motivation.

Customer Loyalty

The likelihood of previous customers to continue to buy from a specific retailer or brand over competing ones.