Thomason Train Sets, Inc. is in the business of manufacturing toy train sets. They have an...
Thomason Train Sets, Inc. is in the business of manufacturing toy train sets. They have an ABC activity-based costing accounting system and have provided the following information:
| Supervisory wages | $ | 650,000 |
| Factory supplies | $ | 250,000 |
The activity pools are listed below with the distribution of resource consumption:
| Activity Cost Pools | Batch Processing | Unit Processing | Other | Total | |
| Supervisory wages | 25% | 60% | 15% | 100% | |
| Factory supplies | 35% | 25% | 40% | 100% | |
The "Other" activity cost pool represents costs of idle capacity and organization-sustaining costs and is therefore not assigned to products.
How much of the supervisory wages and factory supplies cost would NOT be assigned to products using the activity-based costing system?
Garrison 16e Rechecks 2018-07-24
Multiple Choice
-
$0
-
$650,000
-
$197,500
-
$250,000
Homework Answers
| Other | ||
| Supervisory wages | 97500 | =650000*15% |
| Factory supplies | 100000 | =250000*40% |
| Supervisory wages and factory supplies NOT to be assigned | 197500 | |
| Option C $197,500 is correct |
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