Figure 4-11 Yang Manufacturing Company Manufactures Two Products (A and B).The

question 43

Multiple Choice

Figure 4-11 Yang Manufacturing Company manufactures two products (A and B) .The overhead costs ($58,000) have been divided into three cost pools that use the following activity drivers:

- Refer to Figure 4-11.Using functional-based costing, what is the amount of overhead cost to be assigned to Product B using labor hours as the allocation base?

• A) $58,000
• B) $43,500
• C) $11,600
• D) $46,400

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Definitions:

Estimated Fixed Costs

Forecasted expenses that do not vary with the level of production or sales over a specific period of time.

Net Sales

This refers to the total revenue from sales minus returns, allowances for damaged or missing goods, and discounts.

Contribution Margin Ratio

The percentage of each sales dollar that is available to cover the fixed costs and provide an operating income.