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Commerce · Q653

Costing

Graduate and Post Graduate · Commerce · question 653

Q653

If budgeted annual indirect cost is 850000 and budgeted annual quantity of cost allocation base is 7500, then budgeted indirect cost rate would be

A.
112.34 per piece
B.
113.33 per piece
Answer
C.
111.34 per piece
D.
110.34 per piece

Answer: Option B

Solution

Answer: Option B
Solution:
Budgeted indirect cost = Budgeted annual indirect cost ÷ Budgeted annual quantity of cost allocation base
= 7500 = 113.33 per piece