Kandy Harts Manufactures Custom T-Shirts

question 162

Multiple Choice

Kandy Harts manufactures custom T-shirts.Each T-shirt can be imprinted front and back with photos, company logos or other information.Each T-shirt requires 2 ounces of ink, 15 minutes of direct labor (processing, folding, packaging) , and a plastic bag for packaging.The following information is available regarding costs: Kandy applied overhead at a rate of $9.40 per direct labor hour, and fringe benefits for workers are an additional 20% of wages.What is the standard price and standard quantity for manufacturing overhead?

• A)$11.28; 0.25 hour
• B)$9.40; 0.25 hour
• C)$2.35; 1 hour
• D)$2.82; 0.25 hour

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Definitions:

Paid-in Capital

Funds raised by a company through the sale of shares to investors, representing the equity capital invested in the business.

Reacquire Stock

The process by which a company buys back its own shares from the marketplace, reducing the amount of outstanding stock.

Stock Option Plans

A compensation strategy companies use, offering employees the option to buy company stock at a specific price for a certain period.

Acquiring Corporations

Companies that purchase a majority stake in other companies to take control of them.