Gwynnie Pie Company Makes Dessert Pies for National Fast Food

question 243

Multiple Choice

Gwynnie Pie Company makes dessert pies for national fast food chains. Gwynnie Pie Company is considering using ABC costing and has the following activity cost pools and information available: Gwynnie Pie Company currently uses a plantwide overhead rate based on total estimated machine hours of 100,000 hours.
Based on their estimates for ABC costing, what would the allocated cost for all overhead costs for Job 607 be based on the following information about the job:
# of units in the job = 5,000
# of units in each batch = 1,000
# of setups required to complete the job = 1
# of machine hours = 220

• A)$352.50
• B)$994.40
• C)$931.69
• D)$800.00

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Definitions:

Unlimited Liability

A legal obligation in business where owners are personally responsible for all debts of the business, extending to their personal assets.

Limited Liability

A legal structure that protects business owners' personal assets from company debts and liabilities.