Vintage Fun Reproduces Old-Fashioned Style Roller Skates and Skateboards

question 121

Multiple Choice

Vintage Fun reproduces old-fashioned style roller skates and skateboards. The annual production and sales of roller skates is 950 units, while 1,750 skateboards are produced and sold. The company has traditionally used direct labor hours to allocate its overhead to products. Roller skates require 2.5 direct labor hours per unit, while skateboards require 1.25 direct labor hours per unit. The total estimated overhead for the period is $114,300. 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 skateboard using the traditional costing system would be closest to:

• A)$31.32.
• B)$25.05.
• C)$65.31.
• D)$9.31.

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Definitions:

Electron Shells

Electron shells are layers of electrons that surround the nucleus of an atom, where each shell has a different energy level.

Silicon

A chemical element with the symbol Si, known for its semiconductor properties and used extensively in electronic devices.

Anions

Negatively charged ions that are formed when an atom gains one or more electrons, commonly found in various chemical reactions and solutions.

Electrons

Electrons are subatomic particles with a negative charge, found in all atoms, and play a key role in chemical reactions and electricity.