Barnes Corporation manufactures two models of office chairs, a standard and a deluxe model. The following activity and cost information has been compiled.
Number of Number of Number of
Product Setups Components Direct Labor Hours
Standard 22 8 375
Deluxe 28 12 225
Overhead costs $20,000 $40,000
1- Assume a traditional costing system applies overhead costs based on direct labor hours. What is the total amount of overhead costs assigned to the standard model?
A. $22,500
B. $35,200
C. $37,500
D. $24,800
E. None of the above
2. Assume a traditional costing system applies overhead costs based on direct labor hours. What is the total amount of overhead costs assigned to the deluxe model?
A. $24,800
B. $35,200
C. $37,500
D. $22,500
E. None of the above
3. If number of setups and number of components are identified as activity-cost drivers for overhead in a activity-based costing system what is the total amount of overhead costs assigned to the standard model?
A. $22,500
B. $35,200
C. $37,500
D. $24,800
E. None of the above
4. If number of setups and number of components are identified as activity-cost drivers for overhead in an activity-based costing system, what is the total amount of overhead costs assigned to the deluxe model?
A. $22,500
B. $35,200
C. $37,500
D. $24,800
E. None of the above
5. Jones Company has $10 of fixed cost per unit and total variable costs of $120,000 if 12,000 units are produced. The relevant range is 10,000 units to 20,000 units. If 10,000 units are produced, costs are:
A. $10 per unit
B. $120,000 in total.
C. $20 per unit
D. $220,000 in total.
E. None of the above