Kenney Company Uses Activity-Based Costing to Account for Its Manufacturing

question 46

Multiple Choice

Kenney Company uses activity-based costing to account for its manufacturing process. Kenney Company produces tires, and each tire has $.50 of direct materials, includes 20 parts and requires 2 hours of machine time. There is no direct labor. Additional information follows:
$\begin{array}{|l|l|r|}\hline\text { Activity }&\text { Allocation Base }&\text { Cost Allocation Rate }\\\hline \text { Materials handling } & \text { Number of parts } & \$ .16\\\hline \text { Machining } & \text { Machine hours } & \$ 14.40 \\\hline \text { Assembling } & \text { Number of parts } & \$ .70\\\hline \text { Packaging } & \text { Number of finished units } & \$ 5.40\\\hline\end{array}$


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What is the cost of assembling per tire?

• A) $15.40
• B) $7.00
• C) $14.00
• D) $28.00

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Definitions:

Bedpan

A receptacle used by a bedridden patient to collect bodily waste.

Infrequent Bowel Movements

A condition characterized by less frequent passage of stool than is normal for the individual, often indicative of constipation.

Hard Stools

Feces that are firm or difficult to pass, often a symptom of constipation.

Fecal Collection

The process of collecting stool samples for testing or diagnostic purposes, often used to detect infections, inflammation, or digestive conditions.