Use the Information Below to Answer the Following Question(s)

question 18

Multiple Choice

Use the information below to answer the following question(s) .
Jim's Computer Products manufactures keyboards for computers. In June, the two production departments had budgeted allocation bases of 10,000 machine hours in Department 1 and 5,000 direct manufacturing labour hours in Department 2. The budgeted manufacturing overheads for the month were $34,500 and $37,500, respectively. For Job 501, the actual costs incurred in the two departments were as follows:
Job 501 incurred 1,000 machine hours in Department 1 and 300 manufacturing labour hours in Department 2. The company uses a budgeted departmental overhead rate for applying overhead to production.
-What is the total manufacturing cost of Job 892 using budget costing?

• A) $9,900
• B) $12,300
• C) $12,080
• D) $12,255
• E) $12,075

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Definitions:

Income

The money received by individuals or entities, typically in the form of wages, salaries, or various types of investments returns.

Opportunity Cost

The forfeiture of possible benefits from other options when a specific choice is made.

Real Cost

The total cost of producing a good or service, considering all resources including time and opportunity costs.

Choice Set

A set of all possible options available for a consumer or a decision-maker in a given context.