A Company Has Two Products: A1 and B2

question 69

Multiple Choice

A company has two products: A1 and B2. It uses activity-based costing and has prepared the following analysis showing budgeted cost and activity for each of its three activity cost pools: Annual production and sales level of Product A1 is 8,480 units, and the annual production and sales level of Product B2 is 22,310 units. What is the approximate overhead cost per unit of Product B2 under activity-based costing?

• A) $8.00
• B) $9.00
• C) $10.00
• D) $12.00
• E) $4.00

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Definitions:

Stockholders

Owners of shares in a company and thus, hold equity interest, enjoying benefits like dividends and voting rights.

Return On Preferred Stock

The dividend paid on preferred stock divided by the price of the preferred stock, representing the earnings returned on investments in preferred shares.

Stock Decreases

A decrease in the market price of a company's shares.

Cumulative Voting

Cumulative voting is a method used in corporate elections, allowing shareholders to allocate their votes in any manner they choose among the candidates, offering minority shareholders a better chance of representation.