The Emmanuele Company Has Collected the Following Data for Use

question 2

Multiple Choice

The Emmanuele Company has collected the following data for use in calculating product costs:
Activity Data: (expected and actual)
$\begin{array}{|l|l|l|l|}\hline & \text { Mops } & \text { Brooms } & \text { Total } \\\hline \text { Units produced } & 50,000 & 250,000 & 300,000 \\\hline \text { Prime costs } & \$ 200,000 & \$ 750,000 & \$ 950,000 \\\hline \text { Direct labour hours } & 10,000 & 40,000 & 50,000 \\\hline \text { Machine hours } & 20,000 & 10,000 & 30,000 \\\hline \text { Number of setups } & 25 & 75 & 100 \\\hline \text { Inspection hours } & 1,200 & 2,800 & 4,000 \\\hline \text { Number of moves } & 140 & 210 & 350\\\hline\end{array}$ Departmental Data: (expected and actual)
$\begin{array}{|l|r|r|r|}\hline & \text { Moulding } & {\text { Assembly }} & \text { Total } \\\hline \text { Direct labour hours } & & & \\\hline \text { Mops } & 5,000 & 5,000 & 10,000 \\\hline \text { Brooms } & 5,000 & 35,000 & 40,000 \\\hline \text { Total } & 10,000 & 40,000 & 50,000 \\\hline \text { Machine hours } & & & \\\hline \text { Mops } & 17,000 & 3,000 & 20,000 \\\hline \text { Brooms } & 3,000 & 7,000 & 10,000 \\\hline \text { Total } & 20,000 & 10,000 & 30,000 \\\hline \text { Overhead costs } & & & \\\hline \text { Machining } & \$ 120,000 & \$ 30,000 & \$ 150,000 \\\hline \text { Moving materials } & 40,000 & 30,000 & 70,000 \\\hline \text { Setting up } & 70,000 & 10,000 & 80,000 \\\hline \text { Inspecting products } & 20,000 & 30,000 & 50,000 \\\hline \text { Total } & 250,000 & \$ 100,000 & \$ 350,000 \\\hline\end{array}$
-Refer to the figure.What is the unit product cost for mops?

• A)$3.75
• B)$4.00
• C)$7.26
• D)$11.00

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Definitions:

Reinvestment Risk

The risk of earning less interest or dividends from future investments when existing bonds, stocks, or other income-generating assets mature or are sold.

Macaulay Duration

A measure of the weighted average time until a bond's cash flows are repaid, used in assessing interest rate risk.

Future Value

The value of an asset or cash at a specified date in the future that is equivalent in value to a specified sum today, taking into account various factors like interest or returns.

Present Value

The current worth of a future sum of money or stream of cash flows given a specified rate of return.