Answer the Following Questions Using the Information Below:
Woolloongabba Lighting $\$ 900000$

question 25

Multiple Choice

Answer the following questions using the information below:
Woolloongabba Lighting operates one central plant that has two divisions,the Night Light Division and the HalfLight Division.The following data apply to the coming budget year:
Budgeted costs of operating the plant for 2000 to 3000 hours:

Fixed operating costs per year $\$ 900000$
Variable operating costs $\$ 1200$ perhour

Budgeted long-run usage per year:

Night Light Division 2000 hours
HalfLight Division 500 hours
Practical capacity 3000hours Assume that practical capacity is used to calculate the allocation rates.Actual usage for the year by the Night Light Division was 1400 hours and by the HalfLight Division was 600 hours.
-If a single-rate cost-allocation method is used,what amount of cost will be allocated to the Night Light Division? Assume actual usage is used to allocate operating costs.

• A)$3 000 000
• B)$2 280 000
• C)$2 400 000
• D)$2 100 000

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