Answer the Following Question(s)using the Information Below

question 117

Multiple Choice

Answer the following question(s) using the information below.Ernsting Printers has contracts to complete weekly supplements required by forty-six customers.For the year 2018, manufacturing overhead cost estimates total $420,000 for an annual production capacity of 12 million pages.For 2018 Ernsting Printers has 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 2018, two customers, Wealth Managers and Health Systems, are expected to use the following printing services:

-What is the cost driver rate if manufacturing overhead costs are considered one large cost pool and are assigned based on 12 million pages of production capacity?

• A)$0.05 per page
• B)$0.035 per page
• C)$0.35 per page
• D)$0.025 per page
• E)$0.045 per page

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Definitions:

Deforestation

The temporary or permanent removal of forest for agriculture or other uses.

Boreal Forests

Boreal forests, also known as taiga, are dense forests located in high northern latitudes, characterized by cold climates and coniferous trees.

Commercial Logging

The practice of cutting down trees for sale as timber or pulp, often associated with the timber industry.

Slash-And-Burn Agriculture

A type of agriculture in which tropical rain forest is cut down, allowed to dry, and burned. The crops that are planted immediately afterward thrive because the ashes provide nutrients; in a few years, however, the soil is depleted and the land must be abandoned.