Reference: 17_01
Kudzu Company Sells Two Products Big X and Little

question 18

True/False

Reference: 17_01
Kudzu Company sells two products Big X and Little X. Current direct material and direct labor costs are detailed below. Next year, the company wishes to use a plantwide overhead rate with direct labor hours as its allocation base. Next year's overhead is estimated to be $525,000. The direct labor and direct materials costs are estimated to be consistent with the current year. Direct labor costs $20 per hour and the company expects to manufacture 16,000 units of Big X and 18,000 units of Little X next year.
$\begin{array}{|c|c|c|}\hline & \begin{array}{l}\text { Direct } \\\text { Material } \\\text { per Unit }\end{array} & \begin{array}{c}\text { Direct } \\\text { Labor Dollars } \\\text { per Unit }\end{array} \\\hline \operatorname{Big} X & \$5 & \$ 20 \\\hline \text { Little X } &\$3 & \$ 10 \\\hline\end{array}$

-Kudzu has 34,000 total estimated direct labor hours for next year.

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Definitions:

Paired Comparison

A technique used in performance appraisals where employees are compared with each other in pairs, to rank individuals in terms of performance.

Classification/Grading

A job evaluation approach where positions are grouped into categories or grades based on similar duties, responsibilities, and qualifications requirements.

Job Evaluation

A systematic process used to determine the relative worth of jobs within an organization to establish fair and equitable pay.

Ontario Pay Equity Act

Legislation aimed at reducing gender pay disparities by requiring equal pay for work of equal value in Ontario, Canada.