Howe Paper, Inc

Multiple Choice

Howe Paper, Inc., produces a number of products, including a replacement filter bag for a popular vacuum cleaner. The filter bags pass through a machine center where the paper pieces are joined with an adhesive. This machine center operates a single eight-hour daily shift totaling 2,000 hours in each 8,760-hour year. Cycle time for each bag is 10 seconds, and in the just-concluded year, 600,000 filter bags were produced. The total committed costs of running the machine center for the year were $70,080, and the total managed costs were $80,000.
-What total cost of idleness (to the nearest whole dollar) did Howe suffer for the year?

A) $16,000
B) $25,013
C) $324,480
D) $54,080 *