Aimee Cosmetics Company Uses the Following Allocation Rates from Its

question 188

Multiple Choice

Aimee Cosmetics Company uses the following allocation rates from its activity-based costing system to assign overhead costs to products: $$\begin{array} { | l | l | } \hline \text { Activity } & \text { Allocation Rate } \\\hline \text { Purchasing raw materials } & \$ 40 \text { per purchase order } \\\hline \text { Setting up machines for production } & \$ 150 \text { per set-up } \\\hline \text { Inspecting finished products } & \$ 25 \text { per inspection } \\\hline\end{array}$$ Product A1 uses the following:
17 purchase orders
4 set-ups
12 inspections How much overhead cost would be assigned to Product A1?

• A) $7,095
• B) $215
• C) $600
• D) $1,580

---

Definitions:

Drug Testing

The process of analyzing biological samples (such as blood, urine, or hair) to detect the presence of drugs or their metabolites.

Cause

The reason something happens, often used in legal contexts to determine the cause of an event or action leading to liability.

Employees

Employees are individuals who are hired by an employer to perform specific duties in exchange for compensation, typically in the form of wages or salary.

Great Depression

A severe, worldwide economic downturn that took place during the 1930s, marked by high unemployment, deflation, and a significant drop in consumer spending and investment.