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Perdon Corporation manufactures safes, including large mobile safes and large walk-in stationary bank safes. Under traditional costing, what amount of manufacturing overhead costs are assigned to the product lines? a) $160,000 b) $100,000 c) $260,000 d) It cannot be determined from the information provided.
Perdon Corporation manufactures safes, including large mobile safes and large walk-in stationary bank safes. Under traditional costing, what amount of manufacturing overhead costs are assigned to the product lines? a) $160,000 b) $100,000 c) $260,000 d) It cannot be determined from the information provided.
Final answer:The information provided doesn't permit a definite answer to the question about manufacturing overhead allocation under traditional costing at Perdon Corporation. However, the concept of Economies of Scale, where production cost per unit decreases with increased volume, is important in understanding overhead allocation.Explanation:The question you asked regarding the amount of manufacturing overhead costs that are assigned to the product lines at Perdon Corporation under traditional costing cannot be definitively answered with the information provided. Traditional costing assigns manufacturing overhead based on a single, volume-based cost driver such as direct labor hours or machine hours. But the specifics of the product lines, manufacturing processes, and the allocation basis aren't given.Nevertheless, it's crucial to reiterate the concept ofEconomies of Scaleto understand production cost allocations. Economies of scale exist when the cost of production per unit decreases with the increase in scale or quantity of output. For example, the provided figures show that for a small factory (S), the average cost of production is $12 per alarm clock. However, for a larger factory (L), the cost declines to $4 per alarm clock due to larger production quantities. Hence, manufacturing overhead would also vary with the scale of production.Learn more about Manufacturing Overhead Cost Allocation here:brainly.com/question/34659373#SPJ11...