Answer the Following Questions Using the Information Below

Multiple Choice

Answer the following questions using the information below:
One of the makeup kit models that Tiegs Corporation produces is targeted at professional women.The goal for Year 2 is to reduce direct materials usage per unit.No defective units are currently produced.Manufacturing conversion costs depend on production capacity defined in terms of makeup kits that can be produced.The industry market size for makeup kits increased 5% from Year 1 to Year 2.The following additional data are available for Years 1 and 2:

-What is the Tiegs Corporation cost effect of the growth component for direct materials?

A) $1,768,000 U
B) $1,700,000 U
C) $1,232,500 U
D) $1,232,500 F
E) $1,689,000 F