(Appendix 5A) the Blaine Corporation Is a Highly Automated Manufacturer

question 66

Multiple Choice

(Appendix 5A) The Blaine Corporation is a highly automated manufacturer. At an activity level of 6,000 machine setups, total overhead costs equal $240,000. Of this amount, depreciation totals $80,000 (all fixed) and lubrication totals $72,000 (all variable) . The remaining $88,000 of the total overhead cost consists of utility cost (mixed) . At an activity level of 9,000 setups, utility cost totals $112,000.
Assume that the relevant range includes all of the activity levels mentioned in this problem.
-The variable cost per setup for utilities is most likely closest to:

• A) $ 8.00 per setup
• B) $12.44 per setup
• C) $ 4.00 per setup
• D) $14.66 per setup

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Definitions:

Lexical Analysis

The process of converting a sequence of characters into a sequence of tokens, often a preliminary step in the compilation or interpretation of programming languages.

Transformation

A thorough or dramatic change in form, appearance, or character.

Arrangement

The act or process of organizing or ordering items, substances, or elements according to a specific pattern or sequence.

Functional Fixedness

A cognitive bias that limits a person’s ability to use an object only in the way it is traditionally used.