Dartmouth Corporation Manufactures Two Models of Office Chairs, a Standard

question 33

Multiple Choice

Dartmouth Corporation manufactures two models of office chairs, a standard and a deluxe model. The following activity and cost information has been compiled:

Number of setups and number of components are identified as activity-cost drivers for overhead. Assuming an activity-based costing system is used, what is the total amount of overhead costs assigned to the standard model?

• A) $81,200
• B) $81,900
• C) $61,200
• D) $101,200

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Definitions:

Sublease

An arrangement where the original tenant leases part or all of the leased premises to another tenant, while still retaining some responsibilities under the original lease.

Commercial Tenants

Businesses or individuals that lease or rent commercial property or space from a landlord for business purposes.

Lease Agreement

A contractual arrangement calling for the lessee (user) to pay the lessor (owner) for use of an asset for a specified time period.

Fee Simple Absolute

The most complete form of property ownership, giving the owner unrestricted rights to the property, including selling, leasing, or bequeathing.