Pasternik Company Produces and Sells Two Products, Alpha and Zeta

question 32

Multiple Choice

Pasternik Company produces and sells two products, Alpha and Zeta. The following information is available relating to its setup activities: $\begin{array}{lrr} & \text { Alpha } & \text { Zeta } \\\text { Units produced } & 250 & 20,000 \\\text { Batch size (units) } & 10 & 500 \\\text { Total direct labor hours } & 1,000 & 39,000 \\\text { Cost per setup } & \$ 2,000 & \$ 2,000\end{array}$ With a volume-based costing system that applies overhead based on direct labor hours, the setup cost portion of overhead for each unit is (rounded to the nearest cent) :

• A)Option A
• B)Option B
• C)Option C
• D)Option D
• E)Option E

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Definitions:

Maturity Date

The date on which a debt instrument (like a bond) or other financial obligation becomes due and is to be paid off.

Debt Investments

Financial assets involving a loan made by an investor to a borrower, typically involving the issuance of bonds, notes, or other forms of debt securities.

Trading Securities

Investments in debt or equity securities that a company plans to actively buy and sell for profit in the near term.

Short-term Profits

Short-term profits are the earnings a company generates over a brief period, often emphasizing immediate financial performance rather than long-term sustainability.