Telecom uses activity-based costing to allocate all manufacturing conversion costs.Telecom produces cellular telephones;each phone has $40.00 of direct materials,includes 30 parts and requires 3 hours of machine time.Additional information follows:

What is the cost of machining per phone?
A)$42.00
B)$30.00
C)$6.00
D)$15.00

Question

Telecom uses activity-based costing to allocate all manufacturing conversion costs.Telecom produces cellular telephones;each phone has $40.00 of direct materials,includes 30 parts and requires 3 hours of machine time.Additional information follows:

What is the cost of machining per phone?

What is the cost of machining per phone?
A)$42.00 
B)$30.00 
C)$6.00 
D)$15.00

Quizplus · Accepted Answer

A)3 hours × $14.00 = $42.00

Telecom Uses Activity-Based Costing to Allocate All Manufacturing Conversion Costs