Question

Cooper's Bags Company manufactures cloth grocery bags to be sold to grocery stores and other retailers. Cooper's Bags Company sells the bags in cases of 1,600 bags. The bags come in three sizes: Large, Medium, and Small. Currently, Cooper's Bags Company uses a single plantwide overhead rate to allocate its $7,566,000 of annual manufacturing overhead. Of this amount, $2,150,000 is associated with the Large Bag line, $3,420,000 is associated with the Medium Bag line, and $1,996,000 is associated with the Small Bag line. Cooper's Bags Company is currently running a total of 40,000 machine hours: 13,200 in the Large Bag line, 14,500 in the Medium Bag line, and 12,300 in the Small Bag line. Cooper's Bags Company uses machine hours as the cost driver for manufacturing overhead costs. The departmental manufacturing overhead rate for the Small Bag line would be closest to (Round your final answer to the nearest cent.) O A. $162.28 per machine hour. OB. $235.86 per machine hour. O c. $189.15 per machine hour. OD. $162.88 per machine hour.

Answer 1