Reference 05-15
Speed Demon Inc Management Is Considering Implementing Activity Based Costing

question 61

Multiple Choice

Reference 05-15
Speed Demon Inc. manufactures two products: speedometers and odometers. During the month, it produced
2,000 speedometers and 3,000 odometers and incurred estimated overhead costs of $45,300. The company currently allocated overhead on the basis of direct labor hours. This month, the company incurred the following: $\begin{array}{|l|l|l|}\hline & \text { Speedometers } & \text { Odometers } \\\hline \text { Machine Hours } & 750 & 1,000 \\\hline \text { Labour Hours } & 1,200 & 800 \\\hline \text { Labor cost } & \$ 12,000 & 18,000 \\\hline\end{array}$

Management is considering implementing activity based costing. An analysis of estimated overhead costs revealed the following activities:

$\begin{array}{|l|l|l|l|l|}\hline \text { Activity } & \text { Total Cost } & \begin{array}{l}\text { Activity } \\\text { Measure }\end{array} & \begin{array}{l}\text { Use of Activity } \\\text { Measure by Product } \\\text { Line }\end{array} \\\hline & & & \text { Speedometers} & \text { Odometers } \\\hline \begin{array}{l}\text { Materials } \\\text { Handling }\end{array} & \$ 18,000 & \begin{array}{l}\text { of } \\\text { requisitions }\end{array} & 400 & 600 \\\hline \begin{array}{l}\text { Machine } \\\text { Set-ups }\end{array} & 12,600 & \# \text { of set-ups } & 150 & 300 \\\hline \begin{array}{l}\text { Quality } \\\text { Inspections }\end{array} & 14,700 & \begin{array}{l}\text { \# of } \\\text { inspections }\end{array} & 200 & 400 \\\hline\hline\end{array}$
-Assuming a current predetermined overhead rate of $10.00, what is the total overhead allocated to speedometers using the current costing system?

• A)$45,000
• B)$8,000
• C)$12,000
• D)$20,000

Differentiate among primary, secondary, and cardinal traits in Allport’s theory.

Comprehend the significance of functional autonomy in the development of a healthy personality according to Allport.

Explain Allport's views on the role of the ego or self in personality development.

Identify the influence of Allport’s work on the humanistic approach to psychology.

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Definitions:

MRO Supplies

Stands for Maintenance, Repair, and Operations supplies, which are materials used in the upkeep of facilities and equipment.

Asset Disposition

The process of selling, disposing of, or otherwise getting rid of assets no longer required by an organization, often part of asset management strategy.

Third-party Sellers

Independent vendors who sell products or services through a separate platform or marketplace, not owned by them.

Brokers

Intermediaries that facilitate transactions between buyers and sellers, often for financial instruments, real estate, or other assets.