Answer the Following Questions Using the Information Below

question 135

Multiple Choice

Answer the following questions using the information below:
Fey Corporation manufactures two models of office chairs, a standard and a deluxe model. The following activity and cost information has been compiled:

-Number of setups and number of components are identified as activity-cost drivers for overhead. Assuming an activity-based costing system is used, what is the total amount of overhead costs assigned to the deluxe model?

• A)$49,600
• B)$70,400
• C)$75,000
• D)$45,000

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Definitions:

Double-Entry Accounting

An accounting method requiring every financial transaction to be recorded in two accounts, one debit and one credit, to keep the accounting equation balanced.

Debits

Accounting entries that increase assets or expenses or decrease liabilities, equity, or revenue, recorded on the left side of an account.

Credits

Entries on the right-hand side of an accounting ledger, indicating increases in liability, equity accounts, and revenue, or a decrease in assets.

Debit Side

The left side of a ledger account that is used to record increases in assets, expenses, and decreases in liabilities, equity, and income.