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

question 176

Multiple Choice

Use the information below to answer the following question(s) :
Hinckley & Granger Company had the following activities, estimated indirect activity costs, and allocation bases:

Hinckley & Granger uses activity-based costing.
The above activities are used by Departments P and Q as follows:

-What is the cost per driver unit for the account billing activity?

• A) $7.50
• B) $1.50
• C) $10.00
• D) $0.75

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Definitions:

Cost-Plus-Fixed-Fee Pricing

A pricing strategy where the seller charges the cost of production plus a fixed fee as profit.

Standard Markup Pricing

A pricing technique where the selling price of a product is determined by applying a specified percentage markup to its cost.

Bundle Pricing

A marketing strategy where several products or services are offered for sale as a combined package at a reduced price.

Cost-Plus Pricing

A pricing method where the sale price is set by applying a predetermined markup to the cost per unit of a product.