McArthur Company Has Gathered the Following Data Related to Its

question 107

Multiple Choice

McArthur Company has gathered the following data related to its production process of two of its products for the week ended April 30:
$$\begin{array} { | l | r | r | } \hline \text { Model } & \text { Item AB-200 } & \text { Item \#CA40 } \\ \text { Quantly procuced } & \mathbf { 6 0 } & \mathbf { 1 0 0 } \\\hline \text { Unit-level material cost } & \$ 42,000 & \$ 100,000 \\\hline \text { Variable conversion cost } & 72,000 & 300,000 \\\hline \text { Total drect costs } & \$ 114,000 & \$ 400,000 \\\hline \text { Indrect costs: } & & \\\text { Indirect manufacturing cost } & 163,200 & 272,000 \\\hline \text { Indirect operating cost } & \underline { 255,000 } & \underline { 425,000 } \\ \text { Total indirect costs } & \underline { 418,200 } & \underline {697,000} \\\hline \text { Total costs } & \underline { \$ 532,200 }& \underline { \$ 1,097,000} \\\hline\end{array}$$
The costs above that appear to be allocated rather than traced are:

• A) Unit level material costs.
• B) Variable conversion costs.
• C) Indirect production costs only.
• D) All indirect costs.

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