Tierra Co, incurs $240,000 overhead costs each year in its three main departments, setup ($15,000), machining ($165,000), and packing ($60,000). The setup department performs 40 setups per year, the machining department works 5,000 hours per year, and the packing department packs 500 orders per year. Information about Tierra's two products is as follows:

Product A1 Product B1
Number of setups 20 20
Machining hours 1,000 4,000
Orders packed 150 350
Number of products manufactured 600 400

Using ACTIVITY-BASED COST, how much OVERHEAD is assigned to PRODUCT B1 each year?

A) $120,000
B) $96,000
C) $181,000
D) $192,000

Explanation:

Given:

Product B1

#of setups 20

machining hours 4000

Orders packed 350

#of products manufactured 400

Setup dep overhead = 15,000

Machining dep overhead = 165,000

packing department overhead = 60,000

Overhead assigned to B1:

20/40 *15,000 = 7,500

4000/5000 *165,000 = 132,000

350/500 *60,000 = 42,000

Total = 181,500

x=3

step-by-step explanation:

this is really simple i saw that there was only one term (5x) and thought if that was 15 what would i have to multiply everything else to get it there? well if 5x became 15 then x would have to be 3 so plug the 3 in the x for the other equations and you get 15 for the other ones. so there you go. : )

answer; automated fingerprint;