Simpson Company Applies Overhead on the Basis of 200% of Direct

question 168

Multiple Choice

Simpson Company applies overhead on the basis of 200% of direct labor cost. Job No. 305 is charged with $180000 of direct materials costs and $200000 of manufacturing overhead. The total manufacturing costs for Job No. 305 is:

• A) $380000
• B) $480000
• C) $560000
• D) $580000

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Definitions:

Revealed Preference

A theory that assumes individuals' preferences can be determined by their purchasing habits.

Weak Axiom

A principle in consumer choice theory stating that if a consumer prefers bundle A over bundle B when both are available at the same prices, then the consumer will not purchase more of bundle B if its price rises.

Revealed Preference

An economic theory stating that the preferences of consumers can be understood by their purchasing habits.

Prices

The monetary value assigned to goods and services in a market, dictating the exchange rate at which these can be traded.