Table 19-2 Sarita and Gabriel Own S&G Bakery

question 145

Multiple Choice

Table 19-2
$\begin{array}{|l|l|l|} \hline & \text { Pies } & \text { Cakes } \\\hline \text { Sarita } & 15 & 25 \\\hline \text { Gabriel } & 12 & 16\\\hline\end{array}$ Sarita and Gabriel own S&G Bakery. Table 19-2 lists the number of pies and cakes Sarita and Gabriel can each bake in one day.
-Refer to Table 19-2.Select the statement that accurately interprets the data in the table.

• A) Sarita has an absolute advantage in baking cakes and Gabriel has an absolute advantage in baking pies.
• B) Sarita has an absolute advantage in baking pies and Gabriel has an absolute advantage in baking cakes.
• C) Sarita has an absolute advantage in baking pies and cakes.
• D) Gabriel has an absolute advantage in baking pies and cakes.

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Definitions:

Activity Cost Pools

Pools of indirect costs in accounting, classified according to the activities that drive those costs.

Traditional Costing Systems

A method of accounting that allocates overhead costs based on a predetermined rate, often not capturing the actual costs of production accurately.

Manufacturing Costs

The expenses involved in the production of goods, including labor, raw materials, and overhead.

Batch-Level Activities

Activities that are performed each time a batch of goods is handled or processed, regardless of how many units are in the batch. The amount of resource consumed depends on the number of batches run rather than on the number of units in the batch.