What Is Misty's Net Income for the Current Year

question 16

Multiple Choice

What is Misty's net income for the current year?

• A)$148.
• B)$168.
• C)$112.
• D)None of the amounts given are correct.

---

Definitions:

Support Department Costs

Costs associated with the functions that assist the operational activities of a company, including HR, IT, and maintenance services, indispensable for production but not part of the direct manufacturing process.

Sequential Method

A process approach where tasks or operations are performed one after another in a specific order.

ABC

Activity-Based Costing, a method of assigning overhead and indirect costs to specific products or activities based on their use of resources.

Step-Down Method

A method of allocating support department costs to production departments that considers some inter-support-department services in a sequential or step-down fashion. Also known as the sequential method.