Use the Following Information to Answer Questions
Poodle Company

question 55

Multiple Choice

Use the following information to answer questions
Poodle Company manufactures two products, Mini A and Maxi B.Poodle's overhead costs consist of setting up machines, $800,000; machining, $2,000,000; and inspecting, $600,000.Information on the two products is:
$\begin{array}{lll}& \underline{\text { Mini A }}& \underline{\text { Maxi B}} \\\text { Direct labour hours } & 15,000 & 25,000 \\\text { Machine setups } & 600 & 400 \\\text { Machine hours } & 24,000 & 26,000 \\\text { Inspections } & 800 & 700\end{array}$

-Overhead applied to Maxi B using traditional costing and direct labour hours is

• A)$1,280,000.
• B)$1,664,000.
• C)$1,700,000.
• D)$2,125,000.

---

Definitions:

Operating Costs

Expenses associated with the day-to-day operation of a business, excluding financing costs and taxes.

Useful Life

The estimated period over which an asset is expected to be usable for its intended purpose, affecting its depreciation.

Machine

Equipment or apparatus designed to perform a specific task in the manufacturing process.

Present Value

The immediate worth of anticipated money or streams of cash flows, computed with an agreed-upon rate of return.