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

question 9

Multiple Choice

Use the information below to answer the following question(s) :
Louis Corporation, which uses an activity-based costing system, produces travel trailers and boat trailers. The company allocates batch setup costs to the two products using the following basic data:

Total budgeted setup costs for the year are $140,000.
-If the setup costs are allocated using direct labour hours, how much of the total setup costs would be allocated to boat trailers?

• A) $60,000
• B) $105,000
• C) $140,000
• D) $326,667

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Definitions:

Market Value

The market price at which an asset or service can be transacted currently.

Shares Outstanding

The total number of shares of a corporation that have been authorized, issued, and purchased by investors and are held by them.

Debt-Equity Ratio

A metric indicating the balance between shareholders' equity and debt in financing a company's assets.

Capital Spending

Expenditures by a business for acquiring or upgrading physical assets such as property, industrial buildings, or equipment.