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bernie2981 bernie2981
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Posts: 3810
8 years ago
The Cosmo Corporation manufactures and assembles office chairs. Cosmo uses an activity-based costing system to allocate all manufacturing conversion costs. Each chair consists of 15 separate parts totaling $125 in direct materials, and requires 2.0 hours of machine time to produce. Additional information follows:

Activity   Allocation Base   Cost Allocation Rate
Materials handling   Number of parts   $1.75 per part
Machining   Machine hours   $2.00 per machine hour
Assembling   Number of parts   $0.50 per part
Packaging   Number of finished units   $2.75 per finished unit

What is the cost of materials handling per chair?
A) $7.50
B) $4.00
C) $5.50
D) $26.25
Textbook 
Managerial Accounting

Managerial Accounting


Edition: 4th
Author:
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nucleinuclei
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Posts: 2158
8 years ago
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bernie2981 Author
wrote...
8 years ago
Answers my question perfectly.
wrote...
3 years ago
thank you
wrote...
3 years ago
thank you
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