Sampson Company Manufactures Two Products,plain and Complex

question 111

Multiple Choice

Sampson Company manufactures two products,plain and complex.The company has estimated its overhead in the order-processing department to be $480,000.The company produces 50,000 plain and 80,000 complex each year.Plain production requires 25,000 machine hours,complex production requires 50,000 machine hours.The company places raw materials orders 10 times per month,2 times for raw materials for plain and the remainder for raw materials for complex.How much of the order processing overhead should be allocated to complex?

• A)$240,000
• B) $320,000
• C) $295,386
• D) $384,000

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Definitions:

Balanced Reciprocity

A mode of exchange in which the giving and the receiving are specific as to the value of the goods and the time of their delivery.

Market Economy

An economic system where decisions regarding investment, production, and distribution are based on supply and demand, with little government intervention.

Redistributing Income

The process of reallocating wealth and income across a society, typically through taxation and government programs, to reduce economic inequality.

Show of Generosity

A display or act where someone gives something or offers help to others without expecting anything in return.