21. XYZ operates a plant that has two divisions, the Product 1 Division and the Product...
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21. XYZ operates a plant that has two divisions, the Product 1 Division and the Product 2 Division. The following data apply to the coming budget year: Budgeted costs of operating the plant for 2,000 to 3,000 hours: o Fixed operating costs per year Variable operating costs Budgeted long-run usage per year: o Product 1 Division o Product 1 Division Practical capacity $480,000 $500 per hour 1,500 hours 600 hours 3,000 hours . Assume that practical capacity is used to calculate the allocation rates. Actual usage for the year by the Product 3 Division was 1,400 hours Actual usage for the year by the Product 2 Division was 700 hours. If a single-rate cost-allocation method is used, what amount of cost will be allocated to the Product 1 Division? Assume actual usage is used to allocate operating costs. (Do not round any intermediary calculations.) a. $877,333 b. $924,000 c. $990,000 d. $1,180,000 480000 2100 21. XYZ operates a plant that has two divisions, the Product 1 Division and the Product 2 Division. The following data apply to the coming budget year: Budgeted costs of operating the plant for 2,000 to 3,000 hours: o Fixed operating costs per year Variable operating costs Budgeted long-run usage per year: o Product 1 Division o Product 1 Division Practical capacity $480,000 $500 per hour 1,500 hours 600 hours 3,000 hours . Assume that practical capacity is used to calculate the allocation rates. Actual usage for the year by the Product 3 Division was 1,400 hours Actual usage for the year by the Product 2 Division was 700 hours. If a single-rate cost-allocation method is used, what amount of cost will be allocated to the Product 1 Division? Assume actual usage is used to allocate operating costs. (Do not round any intermediary calculations.) a. $877,333 b. $924,000 c. $990,000 d. $1,180,000 480000 2100
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