Nichols Inc

question 54

Multiple Choice

Nichols Inc.manufactures remote controls.Currently the company uses a plant-wide rate for allocating manufacturing overhead.The plant manager is considering switching-over to ABC costing system and has asked the accounting department to identify the primary production activities and their cost drivers which are as follows:

The current traditional cost method allocates overhead based on direct manufacturing labor hours using a rate of $600 per labor hour.
What are the indirect manufacturing costs per remote control assuming an activity-based-costing method is used and a batch of 100 remote controls are produced? The batch requires 460 parts,5 direct manufacturing labor hours,and 18 minutes of inspection time.

• A)$6.00 per remote control
• B)$13.30 per remote control
• C)$32.00 per remote control
• D)$1,330.00 per remote control

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Definitions:

IQ Scores

IQ scores, or Intelligence Quotient scores, represent a person's relative cognitive abilities as compared to the general population.

Standard Deviation

A statistical measure of the dispersion or variation in a set of numbers, indicating how spread out the values are.

Inverse Relationship

A type of correlation where one variable increases while the other decreases, and vice versa.

Negative Correlation

A linkage between two variables that demonstrates an inverse relationship: one rises as the other falls.