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

question 168

Multiple Choice

Use the information below to answer the following question(s) :
Menno Corporation manufactures two products-Tables and Chairs. The annual production and sales of Tables is 2,000 units, while 8,000 units of Chairs are produced and sold. The company has traditionally used direct labour hours to allocate its overhead to products. Tables require 1.0 direct labour hours per unit, while Chairs require 0.5 direct labour hours per unit. The total estimated overhead for the period is $235,000. The company is looking at the possibility of changing to an activity-based costing system for its products. If the company used an activity-based costing system, it would have the following three activity cost pools:
Expected Activity

-The overhead cost per chair using an activity-based costing system would be closest to

• A) $145.00.
• B) $7.25.
• C) $325.00.
• D) $16.25.

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Definitions:

Incentive Models

Theories or systems where rewards are offered to motivate behavior or improve performance.

Buffet

A meal serving style where a variety of dishes are displayed, and diners serve themselves according to their preference.

Diverse Foods

A wide variety of foods from different cultures, ingredients, and culinary traditions.

Snacks

Small portions of food typically consumed between regular meals, often to satisfy temporary hunger or for enjoyment.