Telecom Uses Activity-Based Costing to Allocate All Manufacturing Conversion Costs

Multiple Choice

Telecom uses activity-based costing to allocate all manufacturing conversion costs. Telecom produces cellular telephones; each phone has $40.00 of direct materials, includes 30 parts and requires 3 hours of machine time. Additional information follows: What is the cost of materials handling per phone?

A) $42.00
B) $ 6.00
C) $15.00
D) $30.00