Electronics Unlimited uses activity-based costing to allocate all manufacturing conversion costs. Electronics Unlimited produces computer keyboards; each computer keyboard has $8.00 of direct materials, includes 12 parts and requires 1/2 hour of machine time. Additional information follows:
Activity Allocation Base Cost Allocation Rate
Materials handling Number of parts $ .25 per part
Machining Machine hours $12.00 per machine hour
Assembling Number of parts $1.00 per part
Packaging Number of finished units $1.75 per finished unit
What is the cost of materials handling per computer keyboard?
A) $6.00
B) $15.00
C) $12.00
D) $0.88