Louis Corporation,which Uses an Activity-Based Costing System,produces Travel Trailers and Boat

question 58

Multiple Choice

Louis Corporation,which uses an activity-based costing system,produces travel trailers and boat trailers.The company allocates batch setup costs to the two products using the following basic data:

Total budgeted setup costs for the year are $140,000.
If the setup costs are allocated using direct labour hours,how much of the total setup costs would be allocated to boat trailers?

• A)$60,000
• B)$105,000
• C)$140,000
• D)$326,667

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Definitions:

Price

The financial requirement for obtaining a service or good.

Supply Shifts

Movements of the supply curve to the left or right, indicating a change in the quantity supplied at a given price, caused by factors other than the price of the good itself.

Equilibrium Point

The market condition where demand for a product equals its supply, resulting in a stable price and quantity.

Soft Pretzels

A type of baked pastry made from dough that is commonly twisted into a knot shape and has a soft, chewy texture.