Pinkton Corporation Keeps Careful Track of the Time Required to Fill

question 141

Multiple Choice

Pinkton Corporation keeps careful track of the time required to fill orders. The times recorded for a particular order appear below: The delivery cycle time was:

• A) 8.2 hours
• B) 13.7 hours
• C) 45.9 hours
• D) 46.9 hours

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Definitions:

Activity-Based Costing

A costing method that assigns overhead and indirect costs to related products and services by identifying cost drivers.

Direct Labor-Hours

The total hours worked by employees directly involved in the manufacturing process or providing services, used as a basis for allocating labor costs.

Direct Materials Cost

The expenditure on raw materials that are directly incorporated into a manufactured item.

Activity-Based Costing

A pricing technique that allocates overhead and indirect expenses to corresponding goods and services according to their consumption of resources.