Use the following to answer questions:
Swimm Company allocates materials handling cost to the company's two products using the below data:
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Modular Homes
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Prefab Barns
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Total expected units produced............
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3,000
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4,000
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|
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Total expected material moves............
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400
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100
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Expected direct labor-hours per unit...
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700
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200
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The total materials handling cost for the year is expected to be $72,065.
1. If the materials handling cost is allocated on the basis of direct labor-hours, how much of the total materials handling cost would be allocated to the prefab barns? (Round off your answer to the nearest whole dollar.)
A) $16,014
B) $19,880
C) $36,890
D) $36,033
2. If the materials handling cost is allocated on the basis of material moves, how much of the total materials handling cost would be allocated to the modular homes? (Round off your answer to the nearest whole dollar.)
A) $36,033
B) $57,652
C) $56,051
D) $35,175