Rollo Company Has Developed Cost Formulas for the Drivers of the Following

question 16

Multiple Choice

Rollo Company has developed cost formulas for the drivers of the following production activities:
$$\begin{array} { l l c c } \text { Driver } & \text { Activits } & \text { Fixed } & \text { Variale } \\\hline \text { Labour hours } & \text { Materials } & \$ 0 & \$ 20 \\\text { Labour hours } & \text { Labour } & 0 & 10 \\\text { Machine hours } & \text { Maintenance } & 10,000 & 8 \\\text { Machine hours } & \text { Machiring } & 50,000 & 2 \\\text { Number of setups } & \text { Inspections } & 30,000 & 200 \\\text { Number of setups } & \text { Setups } & 0 & 300 \\\text { Number of purchase arders } & \text { Purchasing } & 75,00 & 3\end{array}$$
-Refer to the figure.The activity levels are projected to be as follows: $$\begin{array} { l r } \text { Labour hours } & 1,000 \\\text { Machine hours } & 5,000 \\\text { Setups } & 100 \\\text { Purchase orders } & 50\end{array}$$ What is budgeted for this projected activity level?

• A)$3,504,450
• B)$1,655,430
• C)$295,150
• D)$165,543

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