Allure Company Manufactures and Distributes Two Products,M and XY What Is the Total Overhead Allocated to Product M Using

question 108

Multiple Choice

Allure Company manufactures and distributes two products,M and XY.Overhead costs are currently allocated using the number of units produced as the allocation base.The controller has recommended changing to an activity-based costing (ABC) system.She has collected the following information:
$\begin{array}{|l|l|r|r|r|}\hline \text { Acturity } & \text { Cost Driser } & \text { Amount } & \text { M } & X Y \\\text { Production } & \text { Number of } & \$ 82,000 & 8 & 12 \\\text { setups } & \text { setups } & & & \\\hline \text { Material } & \text { Number of } & 48,000 & 56 & 24 \\\text { handling } & \text { parts } & & & \\\text { Packaging } & \text { Number of } & 130,000 & 80,000 & 50,000 \\\text { costs } & \text { units } & & & \\\hline &&\underline{\$260,000}&&\\\hline\end{array}$
What is the total overhead allocated to Product M using the current system?

• A) $113,600.
• B) $130,000.
• C) $146,400.
• D) $160,000.

---

Definitions:

Cultural Variations

Differences in social norms, values, customs, and practices among various cultures.

Gallup Organization

The Gallup Organization is a management consulting and research firm known for its public opinion polls and research on societal, political, and economic trends.

Managing by Objectives

A management strategy in which goals are defined for employees to achieve, guiding their performance and progression.

Setting Work Goals

The process of establishing objectives or targets to be achieved in a professional context, often to improve performance or productivity.