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# Question : 18) Brannon Company manufactures ceiling fans and uses an activity-based

18) Brannon Company manufactures ceiling fans and uses an activity-based costing system. Each ceiling fan consists of twenty separate parts. The direct material cost is \$95 and each ceiling fan requires 2.5 hours of machine time to manufacture. Additional information is as follows:

 Activity Allocation Base Cost Allocation Rate \$ Materials handling Number of parts 0.08 Machining Machine hours 7.20 Assembling Number of parts 0.35 Packaging Number of finished units 2.70

What is the cost of assembling per ceiling fan?

A) \$87.50

B) \$7.00

C) \$7.50

D) \$35.00

19) Brannon Company manufactures ceiling fans and uses an activity-based costing system. Each ceiling fan consists of twenty separate parts. The direct material cost is \$95 and each ceiling fan requires 2.5 hours of machine time to manufacture. There is no direct labor cost. Additional information is as follows:

 Activity Allocation Base Cost Allocation Rate \$ Materials handling Number of parts 0.08 Machining Machine hours 7.20 Assembling Number of parts 0.35 Packaging Number of finished units 2.70

What is the total manufacturing cost per ceiling fan?

A) \$125.75

B) \$121.13

C) \$115.32

D) \$124.30

20) Oscar Inc., a manufacturer of gift articles, uses a single plantwide rate to allocate indirect costs. The company allocates manufacturing overhead using a single plantwide rate with machine hours as the allocation base. Estimated overhead cost for the year is \$5,000,000. And estimated machine hours are 25,000. During the year, the actual machine hours used was 30,000. Calculate the predetermined overhead allocation rate.

A) \$166

B) \$250

C) \$200

D) \$150

21) Alpha Company manufactures breadboxes and uses an activity-based costing system. The following information is provided for the month of May:

 Activity Estimated Indirect Activity Costs Allocation Base Estimated Quantity of Allocation Base Materials handling \$3,500 Number of parts 5,000 parts Assembling \$12,000 Number of parts 5,000 parts Packaging \$5,750 Number of bread boxes 1,250 bread boxes

Each breadbox consists of four parts, and the direct materials cost per breadbox is \$7.00. There is no direct labor. What is the total manufacturing cost per breadbox?

A) \$17.40

B) \$24.00

C) \$12.40

D) \$26.00

22) Pitt Jones Company, a manufacturer of small appliances, had the following activities, allocated costs, and allocation bases:

 Activities Allocated Costs Allocation Base Account inquiry (hours) \$60,000 2,000 hours Account billing (lines) \$30,000 20,000 lines Account verification (accounts) \$15,000 20,000 accounts Correspondence (letters) \$10,000 1,000 letters

The above activities are carried out at two of its regional offices.

 Northeast Office Midwest Office Account inquiry (hours) 100 hours 200 hours Account billing (lines) 10,000 lines 7,000 lines Account verification (accounts) 1,000 accounts 600 accounts Correspondence (letters) 50 letters 100 letters

What is the cost per hour for the account inquiry activity?

A) \$0.75

B) \$30.00

C) \$10.00

D) \$1.50

23) Pitt Jones Company, a manufacturer of small appliances, had the following activities, allocated costs, and allocation bases:

 Activities Allocated Costs Allocation Base Account inquiry (hours) \$60,000 2,000 hours Account billing (lines) \$30,000 20,000 lines Account verification (accounts) \$15,000 20,000 accounts Correspondence (letters) \$10,000 1,000 letters

The above activities are carried out at two of its regional offices.

 Northeast Office Midwest Office Account inquiry (hours) 100 hours 200 hours Account billing (lines) 10,000 lines 7,000 lines Account verification (accounts) 1,000 accounts 600 accounts Correspondence (letters) 50 letters 100 letters

What is the cost per line for the account billing activity?

A) \$1.50

B) \$30.00

C) \$1.60

D) \$1.43

24) Pitt Jones Company, a manufacturer of small appliances, had the following activities, allocated costs, and allocation bases:

 Activities Allocated Costs Allocation Base Account inquiry (hours) \$60,000 2,000 hours Account billing (lines) \$30,000 20,000 lines Account verification (accounts) \$15,000 20,000 accounts Correspondence (letters) \$10,000 1,000 letters

The above activities are carried out at two of its regional offices.

 Northeast Office Midwest Office Account inquiry (hours) 100 hours 200 hours Account billing (lines) 10,000 lines 7,000 lines Account verification (accounts) 1,000 accounts 600 accounts Correspondence (letters) 50 letters 100 letters

What is the cost per account for the account verification activity?

A) \$30.00

B) \$0.50

C) \$2.25

D) \$0.75

25) Pitt Jones Company, a manufacturer of small appliances, had the following activities, allocated costs, and allocation bases:

 Activities Allocated Costs Allocation Base Account inquiry (hours) \$60,000 2,000 hours Account billing (lines) \$30,000 20,000 lines Account verification (accounts) \$15,000 20,000 accounts Correspondence (letters) \$10,000 1,000 letters

The above activities are carried out at two of its regional offices.

 Northeast Office Midwest Office Account inquiry (hours) 100 hours 200 hours Account billing (lines) 10,000 lines 7,000 lines Account verification (accounts) 1,000 accounts 600 accounts Correspondence (letters) 50 letters 100 letters

What is the cost per letter for the correspondence activity?

A) \$10.00

B) \$30.50

C) \$25.00

D) \$0.75

26) Pitt Jones Company, a manufacturer of small appliances, had the following activities, allocated costs, and allocation bases:

 Activities Allocated Costs Allocation Base Account inquiry (hours) \$60,000 2,000 hours Account billing (lines) \$30,000 20,000 lines Account verification (accounts) \$15,000 20,000 accounts Correspondence (letters) \$10,000 1,000 letters

The above activities are carried out at two of its regional offices.

 Northeast Office Midwest Office Account inquiry (hours) 100 hours 200 hours Account billing (lines) 10,000 lines 7,000 lines Account verification (accounts) 1,000 accounts 600 accounts Correspondence (letters) 50 letters 100 letters

How much of the account inquiry cost will be assigned to the Midwest Office?

A) \$2,000

B) \$6,500

C) \$3,000

D) \$6,000

27) Pitt Jones Company, a manufacturer of small appliances, had the following activities, allocated costs, and allocation bases:

 Activities Allocated Costs Allocation Base Account inquiry (hours) \$60,000 2,000 hours Account billing (lines) \$30,000 20,000 lines Account verification (accounts) \$15,000 20,000 accounts Correspondence (letters) \$10,000 1,000 letters

The above activities are carried out at two of its regional offices.

 Northeast Office Midwest Office Account inquiry (hours) 100 hours 200 hours Account billing (lines) 10,000 lines 7,000 lines Account verification (accounts) 1,000 accounts 600 accounts Correspondence (letters) 50 letters 100 letters

How much of the correspondence cost will be assigned to the Northeast Office?

A) \$500

B) \$1,200

C) \$2,500

D

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