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Polson Pool Company Is Involved in a Number of Competitive

question 45

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Polson Pool Company is involved in a number of competitive bidding situations. The following costs are anticipated for a project to be bid for Terrance Manufacturing:
Polson Pool Company is involved in a number of competitive bidding situations. The following costs are anticipated for a project to be bid for Terrance Manufacturing:   Which of these costs would be treated differently if Polson had either excess capacity or no excess capacity? A)  Direct materials used, $680,000. B)  Direct labor, $2,450,000. C)  Allocated variable overhead, $570,000. D)  Allocated fixed cost, $230,000. E)  None of these, as all four costs are considered in both situations.
Which of these costs would be treated differently if Polson had either excess capacity or no excess capacity?

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