Question

The Cosmo Corporation manufactures and assembles office chairs. Cosmo uses an activity-based costing system to allocate all manufacturing conversion costs. Each chair vity aterialshandlin achi Allocatian Base Number of parte Machine hours Number ot parte Number of fintaned unita Cost Allocation Iate 200 per mactine hou $0.50 per part $275 er finished What is the cost of assembling per chair?

a. S4.00
b. 55.50
c. $7.50
d. 526.25

Answer 1

c. $7.50

Step-by-step explanation:

Cost of Assembly per chair = Assembly rate per part * Total Parts

Cost of Assembly per chair = $0.50 * 15

Cost of Assembly per chair = $7.5