Ayala IncComputed an Overhead Rate for Machining Costs $1,500,000 of $15

question 128

Multiple Choice

Ayala Inc.computed an overhead rate for machining costs $1,500,000 of $15 per machine hour.Machining costs are driven by machine hours.If computed based on direct labor hours,the overhead rate for machining costs would be $30 per direct labor hour.The company produces two products,Hammer and Tong.Hammer requires 60,000 machine hours and 20,000 direct labor hours,while Tong requires 40,000 machine hours and 30,000 direct labor hours.Using activity-based costing,machining costs assigned to each product is
Hammer $~~~~~~~~$$~~~~~~~~$ Tong

• A) $600,000\(~~~~~~~~\) $900,000
• B) $750,000 \(~~~~~~~~\)$750,000
• C) $800,000 \(~~~~~~~~\)$700,000
• D) $900,000\(~~~~~~~~\) $600,000

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Definitions:

Comedy Shows

Televised or live performances intended to entertain an audience through humor.

Revenue

The total amount of income generated by the sale of goods or services related to the company's primary operations.

API Gravity

A measure used to determine how heavy or light a petroleum liquid is compared to water.

Oil Quality

A measure of the chemical and physical properties of an oil, indicating its suitability for specific uses or processes based on standards or specifications.