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The Pinewood Furniture Company Pty Ltd Plans to Manufacture Two

question 13

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The Pinewood Furniture Company Pty Ltd plans to manufacture two lines of chairs in the coming year-lounge and patio. The company is considering introducing an activity-based costing system. Given below are each activity, its cost and its related activity driver. The Pinewood Furniture Company Pty Ltd plans to manufacture two lines of chairs in the coming year-lounge and patio. The company is considering introducing an activity-based costing system. Given below are each activity, its cost and its related activity driver.   The level of activity for the year is:   Under an activity-based costing system, what is the activity cost per unit of activity driver for finishing? A)  $7.50 per direct labour hour. B)  $30.00 per direct labour hour. C)  $25.00 per unit. D)  $30.00 per unit.
The level of activity for the year is: The Pinewood Furniture Company Pty Ltd plans to manufacture two lines of chairs in the coming year-lounge and patio. The company is considering introducing an activity-based costing system. Given below are each activity, its cost and its related activity driver.   The level of activity for the year is:   Under an activity-based costing system, what is the activity cost per unit of activity driver for finishing? A)  $7.50 per direct labour hour. B)  $30.00 per direct labour hour. C)  $25.00 per unit. D)  $30.00 per unit.
Under an activity-based costing system, what is the activity cost per unit of activity driver for finishing?


Definitions:

Minimum Return

The lowest acceptable rate of return on an investment that a person or company would consider worthwhile.

Investment

The allocation of resources, usually money, in expectation of generating an income or profit.

Target Costing

A pricing method where the selling price is set first, and then the target cost for producing the product is determined by subtracting a desired profit margin.

Desired Return

The specific profit that an investor aims to achieve from an investment.

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