Figure 4-16 Samson Company Recently Installed an Activity-Based Relational Database

question 38

Multiple Choice

Figure 4-16 Samson Company recently installed an activity-based relational database. Using the information contained in the activity relational table, the following pool rates were computed:
$400 per purchase order
$24 per machine hour, Process 1
$30 per machine hour, Process 2
$80 per engineering hour
Two products are produced by Special Products: L and M. The plant has two manufacturing processes, Process 1 and Process 2. Other processes include engineering, product handling, and procurement. Product L goes through Process 1 while Product M goes through Process 2. The product relational table for Special Products is as follows:
Refer to Figure 4-16. How much purchasing overhead cost will be assigned to Product L using the number of purchase orders?

• A) $ 100,000
• B) $ 50,000
• C) $80,000,000
• D) $ 133,500

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Definitions:

Real Property

Land and anything permanently attached to it, such as buildings and natural resources.

Fully Executed Contract

A legally binding agreement that has been fully enacted, with all its terms met by all parties involved.

Labelling Theory

The assertion that once labelled as deviant, people come to accept the label as part of their identity.

Deviant

Behavior that violates the norms, values, or expectations of a group or society, which can provoke negative or positive reactions from others.