Illumination Corporation Operates One Central Plant That Has Two Divisions

question 39

Multiple Choice

Illumination Corporation operates one central plant that has two divisions, the Flashlight Division and the Night Light Division. The following data apply to the coming budget year:

Assume that practical capacity is used to calculate the allocation rates.
Actual usage for the year by the Flashlight Division was 1500 hours and by the Night Light Division was 800 hours. If a dual-rate cost-allocation method is used, what amount of operating costs will be budgeted for the Night Light Division?

• A) $930,000
• B) $950,000
• C) $975,000
• D) $780,000

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Definitions:

Mechanical Links

Connective components in a machine that transfer motion and forces between parts, essential for the mechanical operation and physical interactions within the system.

Solenoids

Electromechanical devices that convert electrical energy into linear mechanical motion, commonly used in valves, locks, and other actuating mechanisms.

Deadband

The range in which an input signal can change without eliciting any response in the output of a system or device, commonly used in control systems.

Activation-Deactivation Cycles

Refers to the repeated process of turning a system or device on (activation) and then off (deactivation).