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Beauty Beyond Words Salon Uses an Activity-Based Costing System to Determine

Question 70

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Beauty Beyond Words Salon uses an activity-based costing system to determine the cost of services. The salon has determined the costs of services by activity and activity usage as follows: Beauty Beyond Words Salon uses an activity-based costing system to determine the cost of services. The salon has determined the costs of services by activity and activity usage as follows: ​ -Graham Company wants to reduce activity costs by $0.30 per unit. The setup activity for a batch of 100 units of Part RR110 currently costs $80 per setup. A process engineer proposes reengineering the setup activity so that it takes 60% of the original cost per setup. By how much will this reduce activity costs per unit? Will more cost savings need to be found? A) $0.53; no B) $0.48; no C) $0.32; no D) $0.22; yes Beauty Beyond Words Salon uses an activity-based costing system to determine the cost of services. The salon has determined the costs of services by activity and activity usage as follows: ​ -Graham Company wants to reduce activity costs by $0.30 per unit. The setup activity for a batch of 100 units of Part RR110 currently costs $80 per setup. A process engineer proposes reengineering the setup activity so that it takes 60% of the original cost per setup. By how much will this reduce activity costs per unit? Will more cost savings need to be found? A) $0.53; no B) $0.48; no C) $0.32; no D) $0.22; yes ​
-Graham Company wants to reduce activity costs by $0.30 per unit. The setup activity for a batch of 100 units of Part RR110 currently costs $80 per setup. A process engineer proposes reengineering the setup activity so that it takes 60% of the original cost per setup. By how much will this reduce activity costs per unit? Will more cost savings need to be found?


A) $0.53; no
B) $0.48; no
C) $0.32; no
D) $0.22; yes

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