Room Chill Company Manufactures Ceiling Fans and Uses an Activity-Based

question 17

Multiple Choice

Room Chill Company manufactures ceiling fans and uses an activity-based costing system.Each ceiling fan has 20 separate parts.The direct materials cost is $85,and each ceiling fan requires 2.50 hours of machine time to manufacture.Additional information is as follows: $$\begin{array} { | l | l | r | } \hline \text { Activity } & \text { Allocation Base } & \begin{array} { c } \text { Predetermined Overhead } \\\text { Allocation Rate }\end{array} \\\hline \text { Materials handling } & \text { Number of parts } & \$ 0.04 \\\hline \text { Machining } & \text { Machine hours } & 6.80 \\\hline \text { Assembling } & \text { Number of parts } & 0.40 \\\hline \text { Packaging } & \text { Number of finished units } & 2.50 \\\hline\end{array}$$ What is the cost of assembling per ceiling fan? (Round any intermediate calculations and your final answer to the nearest cent.)

• A)$85.00
• B)$8.00
• C)$17.00
• D)$34.00

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Definitions:

Earned Income Tax Credit

A refundable tax credit for low- to moderate-income working individuals and families, aimed at reducing poverty and incentivizing work.

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A term that refers to women who receive welfare benefits, often used in discussions regarding public assistance programs.

Child Poverty Rate

The proportion of children living in households with an income below a certain threshold, indicating economic hardship.

Sweden

A Nordic country in Northern Europe known for its high standard of living, comprehensive welfare system, and advanced social and economic structures.