Answer the Following Questions Using the Information Below

question 73

Multiple Choice

Answer the following questions using the information below:
The Quickjet Aircraft Corporation has a central materials laboratory. The laboratory has only two users, the Large Plane Department and the Small Plane Department. The following data apply to the coming budget year:
Budgeted costs of operating the materials laboratory
for 100,000 to 200,000 technician hours per year:
Budgeted long-run usage in hours per year:
Budgeted amounts are used to calculate the allocation rates.
Actual usage for the year by the Large Plane Department was 60,000 technician hours and by the Small Plane Department was 65,000 technician hours.
-If a dual-rate cost-allocation method is used, what amount of materials laboratory costs will be budgeted for the Small Plane Department?

• A)$10,575,000
• B)$7,637,500
• C)$7,050,000
• D)$8,225,000

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Definitions:

Statistical Significance

A mathematical measure indicating that the observed results are not likely due to chance, supporting the hypothesis being tested.

Estimated

Approximated or calculated based on available information or data, often used in the context of measurements or quantifications.

Mortality

The state of being subject to death; often used statistically to refer to the rate of death in a population.

Morbidity

The condition of being diseased or the incidence of illness in a population, as opposed to mortality which refers to death rates.