Mountain Made quilts had a predetermined overhead allocation rate of $5.00 per direct labor hour.  If 5 direct laborers worked 1 ½  hours each to make a batch of  10 quilts, how much total overhead would be allocated to the batch of quilts?
A) $7.50   B) $37.50
C) $30.00  D) $75.00

11)   Assume that the total cost for the batch of 10 quilts made above in #10 was $400.  If Mountain Made wants to earn a gross profit of 40% on each quilt, what price should be charged for each quilt?
A) $160 B) $16 C) $56 D) $560

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12)  Job 2301 requires $12,000 of direct materials, $5,000 of direct labor, 500 direct labor hours, & 300 machine hours.  Manufacturing overhead is computed at $15 per direct labor hour used & $12 per machine hour used.  The total cost of Job 1547 is:
A.  $28,100.  B.  $11,100.
C.  $17,000.  D.  $24,500.

15)  The requisition of direct & indirect materials into production reduces:
A.  finished goods inventory.    B.  manufacturing overhead.
C.  raw materials inventory.    D.  work in process inventory.

16)  Which of the following represents the flow of costs in a manufacturing firm?
A.  Raw materials inventory, finished goods inventory, COGS
B.  Raw materials inventory, WIP, finished goods inventory
C.  Finished goods inventory, work in process inventory, COGS
D.  Work in process inventory, COGS, finished goods inventory

1. Cost distortion results in the:
A. over costing of all products.
B. under costing of all products.
C. over costing of some products & under costing of other products.
D. accurate costing of all products.

2.  What is the first step in developing an ABC system?
A.  Identify the primary activities & estimate a total cost pool for each.
B.  Allocate the costs to the cost object using the activity cost allocation rates.
C.  Select an allocation base for each activity.
D.  Calculate an activity cost allocation rate for each activity.

4.  Which of the following describes how, in ABC, the activity allocation rate is computed?
A.  The total estimated activity cost pool is divided by the total estimated activity allocation base.
B.  The total estimated activity allocation base is divided by the total estimated activity cost pool.
C.  The total estimated activity allocation base is multiplied by the total estimated activity cost pool.
D.  You take the total estimated activity allocation base & subtract the total estimated total activity cost pool.

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