How Much Overhead Cost Will Be Assigned to Each Product

question 177

Multiple Choice

How much overhead cost will be assigned to each product line using activity-based costing (ABC) ?

• A)Dog food: $462,500; cat food: $462,500.
• B)Dog food: $860,000; cat food: $65,000.
• C)Dog food: $60,000; cat food: $45,000.
• D)Dog food: $800,000; cat food: $20,000.
• E)Dog food: $320; cat food: $320.

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Definitions:

Quoted Rate

The stated interest rate or financial charge on a loan or financial product.

Interest

The charge for borrowing money, typically expressed as a percentage of the amount borrowed.

Annuity

A monetary product offering a set sequence of disbursements to a recipient, frequently used to generate income for people who are retired.