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Gooding Company Manufactures Two Models of Its Skillet, the Kitchen

question 168

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Gooding Company manufactures two models of its skillet, the Kitchen and the Campfire.The Kitchen model requires 10,000 direct labor hours and the Campfire requires 30,000 direct labor hours.The company produces 3,400 units of the Kitchen model and 600 units of the Campfire model each year.The company inspects one Kitchen for every 100 produced and inspects one Campfire for every 10 produced.The company expects to incur $84,600 of total inspecting costs this year.How much of the inspecting costs should be allocated to the Kitchen model using ABC costing?

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Definitions:

Sharps Container

A puncture-resistant and leak-proof container designed specifically for the disposal of sharp objects, such as needles and scalpels.

Anticoagulant

A substance that prevents blood from clotting, used in medical treatment to prevent blood clots from forming or growing larger.

Plasma

The liquid component of blood in which blood cells are suspended, consisting mainly of water, proteins, and dissolved substances.

Palpation

The technique of examination using the fingers or hands.

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