Use the information below to answer the following question(s):
Louis Corporation, which uses an activity-based costing system, produces travel trailers and boat trailers. The company allocates batch setup costs to the two products using the following basic data:

Total budgeted setup costs for the year are $140,000.
-If the setup costs are allocated using direct labour hours, how much of the total setup costs would be allocated to boat trailers?
A) $60,000
B) $105,000
C) $140,000
D) $326,667

Question

Use the information below to answer the following question(s):
Louis Corporation, which uses an activity-based costing system, produces travel trailers and boat trailers. The company allocates batch setup costs to the two products using the following basic data:
  
Total budgeted setup costs for the year are $140,000.
-If the setup costs are allocated using direct labour hours, how much of the total setup costs would be allocated to boat trailers?
A) $60,000 
B) $105,000 
C) $140,000 
D) $326,667

Quizplus · Accepted Answer

A)
 11ea895a_939d_b731_861b_bdec0ff24df2_TB1238_00 $140,000/70,000 = $2; $2 × 30,000 = $60,000

Use the Information Below to Answer the Following Question(s)