Excellent Printers Has Contracts to Complete Weekly Supplements Required by Forty-Six

question 136

Multiple Choice

Excellent Printers has contracts to complete weekly supplements required by forty-six customers. For the year 2018, manufacturing overhead cost estimates total $840,000 for an annual production capacity of 12 million pages.
For 2018 Excellent Printers has decided to evaluate the use of additional cost pools. After analyzing manufacturing overhead costs, it was determined that number of design changes, setups, and inspections are the primary manufacturing overhead cost drivers. The following information was gathered during the analysis:

During 2018, two customers, Money Managers and Hospital Systems, are expected to use the following printing services:

When costs are assigned using the single cost driver, number of pages printed, then ________.

• A) Excellent Printers will want to retain this highly profitable customer
• B) Money Managers will likely seek to do business with competitors
• C) Money Managers is unfairly over billed for its use of printing resources
• D) Money Managers is grossly under billed for the job, while other jobs will be unfairly over billed

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Definitions:

National Parks Calendars

Specially designed calendars featuring photographs or illustrations of national parks and their landscapes.

Fiscal Year

A one-year period used for financial reporting and budgeting, which may or may not align with the calendar year.

Adjusting Entries

Journal entries made at the end of an accounting period to update income and expense accounts and ensure adherence to the accrual basis of accounting.

Adjusted Trial Balance

A record comprising all the accounts with their respective balances, revised after adjusting entries, employed in the preparation of financial documents.