Answer the Following Questions Using the Information Below

question 42

Multiple Choice

Answer the following questions using the information below:
Whitman Printing has contracts to complete weekly supplements required by forty-six customers. For the year 20X5, manufacturing overhead cost estimates total $840,000 for an annual production capacity of 12 million pages.
For 2010 Whitman Printing decided to evaluate the use of additional cost pools. After analyzing manufacturing overhead costs, it was determined that number of design changes, setups, and inspections are the primary manufacturing overhead cost drivers. The following information was gathered during the analysis:
During 2010, two customers, Money Managers and Hospital Systems, are expected to use the following printing services:

-ABC systems:

• A)reveal activities that can be eliminated
• B)help control nonfinancial items such as number of setup hours
• C)help identify new designs to reduce costs
• D)All of these answers are correct.

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Definitions:

Inventory Control System

A system used by businesses to manage their inventory levels, ensuring they have the right products in the right quantity for sale, at the right time.

Inventory Period

The average time it takes for a company to convert its inventory into sales.

Cash Flows

The net amount of cash and cash-equivalents being transferred into and out of a business.