Addy Company Has Two Products: a and B $\quad$ $\quad$

question 79

Multiple Choice

Addy Company has two products: A and B. The annual production and sales of Product A is 1,700 units and of Product B is 1,100 units. The company has traditionally used direct labour hours as the basis for applying all manufacturing overhead to products. Product A requires 0.3 direct labour hours per unit, and Product B requires 0.6 direct labour hours per unit. The total estimated overhead for next period is $98,785.

The company is considering switching to an activity-based costing system for the purpose of computing unit product costs for externalreports. The new activity-based costing system would have three factory overhead activity cost pools-Activity 1, Activity 2, and General Factory-with estimated overhead costs and expected activity as follows:

$\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$$\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$$\text { Expected Activity }$
$\begin{array}{|l|r|r|r|r|r}\hline \begin{array}{l}\text { Activity Cost } \\\text { Pool }\end{array} & \begin{array}{r}\text { Estimated } \\\text { Overhead Cost }\end{array} & \text { Product A } & \text { Product B } & \text { Total } \\\hline \text { Activity 1 } & \$ 30,528 & 1,000 & 600 & 1,600 \\\hline \text { Activity 2 } & 17,385 & 1,700 & 200 & 1,900 \\\hline \text { General Factory } & \underline{50,872} & 510 & 660 & 1,170 \\\hline \text { Total } & \$ 98,785 & & &\\\hline\end{array}$

(Note: The General Factory activity cost pool's costs are allocated on the basis of direct labour hours.)
-The overhead cost per unit of Product B under the activity-based costing system is closest to which of the following?

• A) $26.09.
• B) $35.28.
• C) $38.16.
• D) $50.66.

Apply statistical methods to real-world scenarios, interpreting the results within those contexts.

Understand the mathematical operations and transformations applied to random variables.

Apply probability theory to predict outcomes in binomial and uniform distributions.

Critically evaluate assumptions underlying statistical calculations and their implications.

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Definitions:

Storing Information

Refers to the processes and systems used to preserve and retain information over time, typically involving encoding, storing, and retrieving data or knowledge.

Unconscious

The part of the mind that is inaccessible to the conscious mind but that affects behavior and emotions.

Feature Arrangements

The way in which perceptual features are organized and structured in our cognitive processes to represent objects or stimuli.

Mental Images

Visual, or other sensory, representations in the mind that are not currently being perceived but can be recalled or imagined.