Bobby Company Has Two Production Departments, Mixing and Finishing, Served

question 50

Multiple Choice

Bobby Company has two production departments, Mixing and Finishing, served by one maintenance department.Budgeted fixed costs for the maintenance department were $40,000, and the variable cost per labor hour was $4.00.Other relevant data are as follows: $$\begin{array} { l r r } & \text { Mixing } & \text { Finishing } \\\text { Long-run capacity available* } & 18,000 & 12,000 \\\text { Budgeted* } & 12,000 & 10,500 \\\text { Actual* } & 15,000 & 9,000\end{array}$$ *in labor hours
Actual maintenance department costs were $36,000 fixed and $100,000 variable.The amount of fixed maintenance costs allocated to the Finishing Department should be _____.

• A)$18,000
• B)$16,000
• C)$14,000
• D)$11,250

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Definitions:

Effect Size Statistic

A quantitative measure of the magnitude of a phenomenon or the strength of the relationship between variables in statistical research.

Independent Variable

A variable that is intentionally changed by the researcher to examine its impact on the dependent variable.

Type I Error

A statistical error that occurs when a true null hypothesis is incorrectly rejected, falsely indicating a significant effect.

Type II Error

The mistake of failing to reject a null hypothesis when it is actually false, leading to a false negative conclusion.