Dragon Fire Hot Sauce Makes Two Types of Hot Sauces-Meek

question 48

Multiple Choice

Dragon Fire Hot Sauce makes two types of hot sauces-meek and mild.Budgeted information for the two flavors appears below: $\begin{array}{lrr}&\text { Meek }&\text { Mild }\\\text { Sales } & \$ 600,000 & \$ 400,000 \\\text { Direct materials } & \$ 100,000 & \$ 120,000 \\\text { Direct labor cost } & \$ 108,000 & \$ 180,000 \\\text { Labor hourly cost } & \$ 12,00 & \$ 12,00\end{array}$ The company estimates it will incur $345,600 in overhead costs for the period.Dragon Fire allocates overhead cost to products based on the labor cost incurred.How much overhead is assigned to Mild?

• A)$216,000
• B)$28,800
• C)$56,250
• D)None of these answer choices are correct.

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Definitions:

T-statistic

A type of statistic used in hypothesis testing to determine if there is a significant difference between two groups.

Null

Usually referring to the null hypothesis, it's a statement suggesting no significant effect or difference in a clinical or experimental study.

Alpha

In hypothesis testing, the probability of making a Type I error; the significance level set before conducting a test.

Alternative

Refers to the alternative hypothesis in statistical testing, which contrasts the null hypothesis by suggesting there is a significant effect or difference.