(Appendix 4A)Koszyk Manufacturing Corporation Has a Traditional Costing System in Which

question 8

Multiple Choice

(Appendix 4A) Koszyk Manufacturing Corporation has a traditional costing system in which it applies manufacturing overhead to its products using a predetermined overhead rate based on direct labor-hours (DLHs) .The company has two products, P85G and C43S, about which it has provided the following data: The company's estimated total manufacturing overhead for the year is $2, 264, 000 and the company's estimated total direct labor-hours for the year is 40, 000. The company is considering using a variation of activity-based costing to determine its unit product costs for external reports.Data for this proposed activity-based costing system appear below: The manufacturing overhead that would be applied to a unit of product P85G under the company's traditional costing system is closest to:

• A)$89.67
• B)$45.28
• C)$44.39
• D)$23.20

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Definitions:

Withdrawal

The action of taking money out of an account, or the removal of assets from a business by the owner for personal use.

Equity Interest

Ownership interest in a company, represented by the equity or shares held by investors.

Mutual Agreement

A consensus reached by two or more parties where the terms of an engagement or deal are accepted by all involved.

Limited Life

Refers to the finite existence of certain assets, indicating they will only last for a specific period before ceasing to be useful.