Figure 3-7
Granite, Inc The Following Are Two of the Jobs Completed During the and Cost

question 49

Multiple Choice

Figure 3-7
Granite, Inc., has identified the following overhead costs and cost drivers for next year: $$\begin{array} { l r l r } \text { Overhead Item } & \text { Expected Cost } & { \text { Cost Driver } } & \text { Expected Quantity } \\\text { Setup costs } & £ 100,000 & \text { Number of setups } & 500 \\\text { Ordering costs } & 40,000 & \text { Number of orders } & 3,200 \\\text { Maintenance } & 200,000 & \text { Machine hours } & 4,000 \\\text { Power } & 20,000 & \text { Kilowatt hours } & 80,000\end{array}$$ The following are two of the jobs completed during the year: $\begin{array}{lrr}&\text { Job } 500&\text { Job } 501\\\text { Direct materials } & £ 1,500 & £ 2,000 \\\text { Direct labour } & £ 1,400 & £ 2,400 \\\text { Units completed } & 100 & 160 \\\text { Direct labour hours } & 100 & 160 \\\text { Number of setups } & 2 & 8 \\\text { Number of orders } & 8 & 10 \\\text { Machine hours } & 40 & 50 \\\text { Kilowatt hours } & 60 & 100\end{array}$ The company's normal activity is 4,000 direct labour hours.
-Refer to Figure 3-7. If Granite's direct labour hours are used to assign overhead, the unit cost for Job 500 would be

• A)£104.
• B)£105.
• C)£114.
• D)£119.

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Definitions:

Protist

A diverse group of eukaryotic microorganisms, which are neither plants, animals, nor fungi, and share some characteristics with those groups.

Eukaryotic

Referring to cells that contain a nucleus and other organelles enclosed within membranes, characteristic of all life forms except bacteria and archaea.

Single Cell

Pertaining to an organism or entity that consists of only one cell, often referring to unicellular organisms.

Foliose

A type of lichen that has a leaf-like appearance, typically loosely attached to its substrate by the middle, allowing some movement.