Consider the Following Information Attributed to the Material Management Department

question 142

Multiple Choice

Consider the following information attributed to the material management department
Budgeted usage of materials-handling labor-hours 3500
Budgeted cost pools:
Fixed costs $154,000
Variable costs $126,000 (3500 hours x $36 per hour)
The company uses the single-rate method to allocate support costs to the Machining and Assembly Departments. Assuming that the actual hours tracked in the Machining and Assembly department are 500 for the month, what would be the allocation rate and how much cost would be allocated to the Machining and Assembly Department for the operations of the month? (Round final answers to the nearest dollar.)

• A) $80 an hour for a total of $40,000
• B) $36 an hour for a total of $40,000
• C) $36 an hour for a total of $18,000
• D) $560 an hour for a total of $80

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Definitions:

Behavioral Segmentation

The process of dividing a market into groups based on consumer behaviors, such as purchase history, product usage, or decision-making patterns.

Product Features

Specific characteristics or attributes of a product that are intended to enhance its appeal to potential buyers.

Different Customers

Different customers refer to the varying groups of consumers, each with unique needs, preferences, and purchasing behaviors.

Behavioral Segmentation

The division of a market into groups based on consumer knowledge, attitudes, uses, or responses to a product.