Fidelity Stereo Company Has Provided the Following Information Regarding Its

question 22

Multiple Choice

Fidelity Stereo Company has provided the following information regarding its activity-based costing system: Purchasing department costs are allocated based on purchase orders, and the predetermined overhead allocation rate is $77 per purchase order.
? Assembly department costs are allocated based on the number of parts used, and the predetermined overhead allocation rate is $5 per part.
? Packaging department costs are allocated based on the number of units produced, and the predetermined overhead allocation rate is $4 per unit produced.
Each stereo produced has 50 parts,and the direct materials cost per unit is $70.There are no direct labor costs.Fidelity Stereo has an order for 1200 stereos,which will require 45 purchase orders in all.What is the total cost for the 1200 stereos?

• A) $392,265
• B) $307,950
• C) $303,465
• D) $388,800

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