Lauter Printing Uses Two Measures of Activity, Press Runs and Book

question 229

Multiple Choice

Lauter Printing uses two measures of activity, press runs and book set-ups, in the cost formulas in its budgets and performance reports. The cost formula for wages and salaries is $5,300 per month plus $480 per press run plus $1,080 per book set-up. The company expected its activity in October to be 169 press runs and 64 book set-ups, but the actual activity was 167 press runs and 60 book set-ups. The actual cost for wages and salaries in October was $155,690.
-The wages and salaries in the planning budget for October would be closest to:

• A) $157,555
• B) $155,690
• C) $150,260
• D) $155,540

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Definitions:

Labor Unions

Organizations formed by workers from related fields to protect their common interests and improve their working conditions through collective bargaining.

Bank Failures

occur when banks are unable to meet their obligations to depositors and creditors and must close or be taken over by regulatory agencies.

Farm Subsidies

Financial assistance from the government to farmers to supplement their income, manage the supply of agricultural commodities, and influence the cost and supply of such commodities.

Corporate Farms

Large-scale farming operations owned or operated by companies rather than individuals or families, often characterized by industrial agricultural practices.