Alexander Inc

question 191

Multiple Choice

Alexander Inc.uses activity-based costing.The company produces two products: Snaps and Pops.The expected annual production of Snaps is 1,500 units,while the expected annual production of Pops is 2,200 units.There are three activity cost pools: Assembly,Testing,and Packing.The estimated costs and activities for each of these three activity pools follows:
The cost pool activity rate for Testing would be

• A)$21.43 per activity.
• B)$13.90 per activity.
• C)$39.56 per activity.
• D)$6.95 per activity.

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Definitions:

Market Equilibrium

A situation in which market supply equals market demand, so there is no incentive for price changes unless external conditions change.

Great Depression

A severe worldwide economic downturn during the 1930s, marked by prolonged unemployment, deflation, and significant declines in economic activity.

Economic Principle

Fundamental concepts that underpin the study and practice of economics, such as supply and demand or the cost-benefit analysis.

Productive Capacity

The maximum output a firm or economy can produce with its current level of resources and technology.