One of Astro Fireworks Company's activity cost pools is machine setups, with estimated overhead of $200,000.Astro produces sparklers (75 setups)and lighters (25 setups).How much of the machine setup cost pool should be assigned to sparklers?
A)$50,000
B)$150,000
C)$166,666
D)$200,000

Question

Quizplus · Accepted Answer

The total number of setups is 100 (75 for sparklers + 25 for lighters). Sparklers account for 75% of the setups (75 setups for sparklers / 100 total setups). Therefore, 75% of the $200,000 machine setup cost pool, or $150,000, should be assigned to sparklers.

One of Astro Fireworks Company's Activity Cost Pools Is Machine