Answer the Following Questions Using the Information Below

question 2

Multiple Choice

Answer the following questions using the information below:
Beat, Inc., expects to sell 60,000 athletic uniforms for $80 each in 2012. Direct materials costs are $20, direct manufacturing labor is $8, and manufacturing overhead is $6 for each uniform. The following inventory levels apply to 2011:

-What is the amount budgeted for cost of goods sold in 2012?

• A)$2,312,000
• B)$1,972,000
• C)$2,040,000
• D)$4,800,000

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Definitions:

Activity Cost Pools

Collections of overhead costs assigned to specific activities, used in activity-based costing to allocate costs more accurately.

Activity Rates

Rates used in activity-based costing to allocate costs to products or services based on the activities they require.

Activity-Based Costing

A costing methodology that assigns overhead and indirect costs to related products and services based on their usage of resources.

Direct Labor-Hours

The total hours worked directly on the manufacturing of goods.