Telecom Uses Activity-Based Costing to Allocate All Manufacturing Conversion Costs

question 204

Multiple Choice

Telecom uses activity-based costing to allocate all manufacturing conversion costs. Telecom produces cellular telephones; each phone has $60.00 of direct materials, includes 40 parts and requires 3 hours of machine time. Additional information follows: What is the cost of machining per phone?

• A)$9
• B)$80
• C)$21
• D)$100

---

Definitions:

Misconduct

Improper or unlawful behavior by a person in a professional or official capacity.

Partnership Business

A type of business organization in which two or more individuals share ownership, profits, and liabilities.

Binds the Firm

Implies an agreement or action that legally obligates a company to a particular course of action or contractual obligation.

Partnership Obligation

Legal responsibilities and duties that arise in a business partnership, including fiduciary duties and liabilities shared among partners.