Author Question: A firm produces and sells two products, Standard and Deluxe. The following information relates to ... (Read 21 times)

lauraleepop · **on:** Feb 5, 2023

Question 1

Patel Catering Service uses an activity-based costing system. What is the most appropriate cost driver for the activity of preparing meals?
◦ Number of meals prepared
◦ Number of rolls used
◦ Rent on building
◦ Number of orders taken

Question 2

A firm produces and sells two products, Standard and Deluxe. The following information relates to setup costs of $180,000 (a part of factory overhead).

	Standard	Deluxe
Units produced	1,600	1,600
Number of setups	100	125
Direct labor hours per unit	9	9
Total direct labor costs	$9,000	$9,000

Activity-based costing will allocate which of the following amounts of setup cost to each unit (rounded to the nearest dollar)?

Standard

Deluxe

◦

$56

◦

50

63

◦

356

444

◦

126

101

mamboz · **Reply #1 on:** Feb 5, 2023

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