Stronghold, Inc For Purposes of Performance Evaluation, Fixed Costs Allocated to Brochure

question 19

Multiple Choice

Stronghold, Inc., operates a brochure business at two different locations. Stronghold, Inc., has one support department that is responsible for cleaning, service, and maintenance of its printing equipment. The costs of the support department are allocated to each brochure center on the basis of total brochures made. During the first month, the costs of the support department were expected to be $400,000. Of this amount, $120,000 is considered a fixed cost. During the month, the support department incurred actual variable costs of $256,000 and actual fixed costs of $144,000.
Normal and actual activity (brochures made) are as follows: $\begin{array}{lll}&\text { Brochure Center } 1 &\text { Brochure Center } 2\\\text { Normal activity (brochures) } & 1,200,000 & 800,000 \\\text { Actual activity (brochures) } & 1,000,000 & 880,000\end{array}$
For purposes of performance evaluation, fixed costs allocated to Brochure Center 1 are:

• A)$60,000.
• B)$72,000.
• C)$65,600.
• D)$75,200.

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Definitions:

Confidence Level

The probability or percentage that a parameter lies within a specified range of values, indicating the degree of certainty about a statistical estimate.

One-sample T Test

A statistical evaluation designed to ascertain if there's a significant difference between the mean of a single sample and a known or assumed mean of a population.

Subjects

Individuals or entities that are observed or experimented upon in scientific or research studies.

Similar

Having characteristics in common or resembling each other, without being exactly the same.