A Company Incurred $80,000 of Common Fixed Costs and $120,000

question 6

Multiple Choice

A company incurred $80,000 of common fixed costs and $120,000 of common variable costs. These costs are to be allocated to Departments A and B. Data on capacity provided and capacity used are as follows: Assume that both fixed and variable costs are allocated on the basis of capacity used. The fixed and variable costs allocated to Department A are

• A) $40,000 $60,000
• B) $50,000 $60,000
• C) $40,000 $75,000
• D) $50,000 $75,000

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Definitions:

Retinal Disparity

The slight difference between the images projected onto each eye, contributing to depth perception in binocular vision.

Relative Size

Relative size is a visual perception cue that allows one to determine how close or far away an object is based on its size in relation to other objects.

Interposition

A visual cue used to perceive depth, where one object partially covers another, indicating that the covering object is closer.

Perceptual Constancy

The psychological feature that allows the perception of an object to remain relatively unchanged despite variations in the conditions of observation.