Figure 11-5
Granite, SA The Following Are Two of the Jobs Completed During the and Cost

question 1

Multiple Choice

Figure 11-5
Granite, SA., has identified the following overhead costs and cost drivers for next year: $$\begin{array} { l l l l } \text { Overhead Item } & \text { Expected Cost } & \text { Cost Driver } & \text { Expected Quantity } \\\text { Setup costs } & £ 100,000 & \text { Number of setups } & 500 \\\text { Ordering costs } & 40,000 & \text { Number of orders } & 3,200 \\\text { Maintenance } & 200,000 & \text { Machine hours } & 4,000 \\\text { Power } & 20,000 & \text { Kilowatt hours } & 80,000\end{array}$$ The following are two of the jobs completed during the year: $\begin{array}{lll}&\underline{\text { Job } 500}&\underline{\text { Job } 501}\\\text { Direct materials } & £ 1,500 & £ 2,000 \\\text { Direct labour } & £ 1,400 & £ 2,400 \\\text { Units completed } & 100 & 160 \\\text { Direct labour hours } & 100 & 160 \\\text { Number of setups } & 2 & 8 \\\text { Number of orders } & 8 & 10 \\\text { Machine hours } & 40 & 50 \\\text { Kilowatt hours } & 60 & 100\end{array}$ The company's normal activity is 4,000 direct labour hours.
-Refer to Figure 11-5. If Granite, SA., used activity-based cost drivers to allocate overhead costs, the total cost of Job 500 would be

• A)£5,715.
• B)£5,667.
• C)£5,415.
• D)£5,315.

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Definitions:

Corpus Callosum

The large neural structure containing fibers that connect the right and left cerebral hemispheres.

Frontal

Pertaining to the frontal lobe of the brain, which is involved in executive functions such as decision making, problem solving, and controlling behavior and emotions.

Parietal

Pertaining to the parietal lobe of the brain, involved in processing sensory information regarding the location of parts of the body as well as processing language and mathematics.

Occipital Lobes

The region of the brain located at the back of the head, responsible for processing visual information from the eyes.