Conan Electronics Corporation manufactures and assembles electronic motor drives for video cameras.The company assembles the motor drives for several accounts.The process consists of a lean cell for each customer.The following information relates only to one customer's lean cell.For the year,planned labor and overhead was $80,000,000; materials costs,$25 per unit.Planned production included 9,600 hours to produce 76,800 motor drives.Actual production for the month of August was 5,200 units,and motor drives shipped amounted to 5,040 units.From the foregoing information,determine the budgeted cell conversion cost per hour.
A) $8,025
B) $800
C) $7,200
D) $8,333

Question

Quizplus · Accepted Answer

The budgeted cell conversion cost per hour is calculated by dividing the planned labor and overhead costs by the planned production hours. Therefore, $80,000,000 / 9,600 hours = $8,333.

Conan Electronics Corporation Manufactures and Assembles Electronic Motor Drives for Video