Vandalay Industries Manufactures Two Products: Toasters and Blenders

question 213

Multiple Choice

Vandalay Industries manufactures two products: toasters and blenders. The annual production and sales of toasters is 2,200 units, while 1,500 units of blenders are produced and sold. The company has traditionally used direct labor hours to allocate its overhead to products. Toasters require 1.25 direct labor hours per unit, while blenders require 1 direct labor hours per unit. The total estimated overhead for the period is $149,115. The company is looking at the possibility of changing to an activity-based costing system for its products. If the company used an activity-based costing system, it would have the following three activity cost pools: The overhead cost per blender using an activity-based costing system would be closest to

• A)$ 27.72.
• B)$ 73.00.
• C)$ 99.41.
• D)$ 40.66.

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Definitions:

MyPlate Icon

A visual guide created by the USDA to help Americans understand and follow healthy eating patterns, depicting the recommended dietary proportions of fruits, vegetables, grains, protein foods, and dairy.

Vegetables

Edible plants or parts of plants, such as leaves, stems, roots, and seeds, commonly consumed in diets and known for nutritional benefits.

Essential Nutrients

Nutrients that cannot be synthesized by the body and must be obtained from the diet, including certain amino acids, fatty acids, vitamins, and minerals.

Kilocalories

A unit of energy measurement in nutrition, commonly called a calorie, equivalent to 1000 small calories.