A Company Incurs $4,050,000 of Overhead Each Year in Three

question 4

Multiple Choice

A company incurs $4,050,000 of overhead each year in three departments: Ordering and Receiving, Mixing, and Testing. The company prepares 2,000 purchase orders, works 50,000 mixing hours, and performs 1,500 tests per year in producing 200,000 drums of Goo and 600,000 drums of Slime. The following data are available: $\begin{array}{crr}\text { Department}&\text {Expected use of Driver }&\text {Cost }\\\text { Ordering and Receiving } & 2,000 & \$ 1,200,000 \\\text { Mixing } & 50,000 & 1,500,000 \\\text { Testing } & 1,500 & 1,350,000\end{array}$

$\text { Production information for Slime is as follows: }$
$\begin{array}{cr}\text { Department }&\text { Expected use of Driver }\\\text { Ordering and Receiving } & 1,600 \\\text { Mixing } & 30,000 \\\text { Testing } & 1,000\end{array}$ Compute the amount of overhead assigned to Slime.

• A)$2,025,000
• B)$2,467,851
• C)$2,760,000
• D)$3,037,500

---

Definitions:

IQ Scores

A measure of a person's cognitive abilities and potential, commonly expressed as a score derived from standardized tests designed to assess human intelligence.

Percentage

A mathematical term describing a number or ratio expressed as a fraction of 100.

Standardized Tests

Tests that are administered and scored in a consistent, or "standard," manner and are designed to measure students' comparative performance.

Normal Curve

A bell-shaped curve that represents the distribution of many types of data where most values cluster around a central region, with values tapering off as they move away from the center.