Figure 4-17 Moss Corporation Has the Following Activities: Creating Bills

question 77

Multiple Choice

Figure 4-17 Moss Corporation has the following activities: creating bills of materials (BOM) , studying manufacturing capabilities, improving manufacturing processes, training employees, and designing tooling.The general ledger accounts reveal the following expenditures for manufacturing engineering:
The equipment is used for two activities: improving processes and designing tooling.Thirty-five percent of the equipment's time is used for improving processes and 65 percent is used for designing tools.The salaries are for two engineers.One is paid $50,000, while the other earns $25,000.The $50,000 engineer spends 40 percent of his time training employees in new processes and 60 percent of his time on improving processes.The remaining engineer spends equal time on all activities.Supplies are consumed in the following proportions:

-Refer to 4-17.What is the cost assigned to the designing tooling activity?

• A) $81,250
• B) $33,000
• C) $25,000
• D) $125,000

---

Definitions:

Free-Trade Policies

Economic policies that allow imports and exports to occur without restrictive tariffs, quotas, or other barriers to trade.

Protection

The practice of shielding a sector of the economy from foreign competition.

General Agreement on Tariffs and Trade

An international treaty aimed at promoting international trade by reducing or eliminating trade barriers such as tariffs and quotas; it was replaced by the World Trade Organization (WTO) in 1995.

Voluntary Export Restraint

A self-imposed limitation by exporting countries on the volume of their exports of a particular good.