Figure 7-4.Honeydew Company produces two products, a high end laptop computer under the label Bunsen Laptops, and an inexpensive desktop computer under the label Beaker Computers. The two products use two overhead activities, with the following costs:
The controller has collected the expected annual prime costs for each product, the machine hours, the setup hours, and the expected production.
-Refer to Figure 7-4. Calculate Beaker's consumption ratio for setup hours.
A) 0.50
B) 0.45
C) 0.90
D) 0.25
E) 0.75

Question

Figure 7-4.Honeydew Company produces two products, a high end laptop computer under the label Bunsen Laptops, and an inexpensive desktop computer under the label Beaker Computers. The two products use two overhead activities, with the following costs:
  The controller has collected the expected annual prime costs for each product, the machine hours, the setup hours, and the expected production. 
-Refer to Figure 7-4. Calculate Beaker's consumption ratio for setup hours.
A) 0.50 
B) 0.45 
C) 0.90 
D) 0.25 
E) 0.75

Quizplus · Accepted Answer

Beaker's consumption ratio for setup hours is 0.50, which is calculated by dividing Beaker's setup hours (10 hours) by the total setup hours for all three work centers (20 hours).