Samson Company Recently Installed an Activity-Based Relational Database $\$ 400$ Per Purchase Order

question 150

Multiple Choice

Samson Company recently installed an activity-based relational database. Using the information contained in the activity relational table, the following pool rates were computed: $\$ 400$ per purchase order
$\$ 24$ per machine hour, Process 1
$\$ 30$ per machine hour, Process 2
$\$ 80$ per engineering hour Two products are produced by Special Products: L and M. The plant has two manufacturing processes, Process 1 and Process 2. Other processes include engineering, product handling, and procurement. Product L goes through Process 1 while Product M goes through Process 2. The product relational table for Special Products is as follows: Product L
$$\begin{array} { | c | l | c | } \hline \text { ActivityDriver \# } & { \text { Name } } & \text { Activity Usage } \\\hline 1 & \text { Units } & 200,000 \\\hline 2 & \text { Purchase Orders } & 250 \\\hline 3 & \text { Machine Hours } & 80,000 \\\hline 4 & \text { Engineering Hours } & 1,250 \\\hline & & \\\hline\end{array}$$
Product M
$$\begin{array} { | c | l | l| } \hline \text { Activity Driver \# } & { \text { Name } } & { \text { Activity Usage } } \\\hline 1 & \text { Units } & 25,000 \\\hline 2 & \text { Purchase Orders } & 125 \\\hline 3 & \text { Machine Hours } & 10,000 \\\hline 4 & \text { Engineering Hours } & 1,500 \\\hline\end{array}$$ $$\begin{array} { | c | l | c | } \hline \text { ActivityDriver \# } & { \text { Name } } & \text { Activity Usage } \\\hline 1 & \text { Units } & 200,000 \\\hline 2 & \text { Purchase Orders } & 250 \\\hline 3 & \text { Machine Hours } & 80,000 \\\hline 4 & \text { Engineering Hours } & 1,250 \\\hline & & \\\hline\end{array}$$ What is the unit cost of Product L?

• A)$9.42
• B)$504.00
• C)$10.60
• D)$7.52

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Definitions:

Dependent Variables

In an experiment, the variable that is measured and is expected to change in response to manipulations of the independent variable.

Anecdote

A short and interesting story or account of a real incident or event, often used to illustrate a point or entertain.

Experimental Result

The outcome or data obtained from conducting a systematic investigation in a controlled setting aimed at testing a specific hypothesis.

Selective Truth

The practice of presenting facts or data that only support one side of an argument while ignoring information that contradicts it.