Peters, Inc

question 33

Short Answer

Peters, Inc. produces 3 products: P1, Q2, and R3. P1 requires 400 purchase orders, Q2 requires 600 purchase orders, and R3 requires 1,000 purchase orders. Peters has identified an ordering and receiving activity cost pool with allocated overhead of $240,000 for which the cost driver is purchase orders. Direct labor hours used on each product are 50,000 for P1, 40,000 for Q2, and 110,000 for R3. How much ordering and receiving overhead is assigned to each product? $\begin{array}{llll}&P1&Q2&R3\\\text { a. } & \$ 80,000 & \$ 80,000 & \$ 80,000 \\\text { b. } & \$ 60,000 & \$ 48,000 & \$ 132,000 \\\text { c. }& \$ 48,000 & \$ 72,000 & \$ 120,000 \\\text { d. } & \$ 54,000 & \$ 60,000 & \$ 126,000\end{array}$

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Definitions:

Culturally Adaptive

The ability of individuals or societies to adjust and adopt behaviors or practices in response to changing environmental or social conditions, enhancing survival and success.

Appropriate One

A term indicating the most suitable or fitting option among multiple choices in a given context.

Socially Constructed

A concept or perception that is created and developed by society, rather than existing inherently or naturally.

Share

To have or use something in common with others; in a business context, it refers to a unit of ownership in a company or financial asset.